Q1 2026 NeoGenomics Inc Earnings Call

April 28, 2026

Matthew: Good afternoon, welcome to the NeoGenomics Q1 2026 Financial Results Call. Please be advised that today's conference is being recorded. I will now turn the call over to Priya Vedaraman, Senior Vice President of Finance.

Operator: Good afternoon, welcome to the NeoGenomics Q1 2026 Financial Results Call. Please be advised that today's conference is being recorded. I will now turn the call over to Priya Vedaraman, Senior Vice President of Finance.

Speaker #1: Thank you, Matthew. And good afternoon, everyone. Welcome to Neogenomics First Quarter 2026 Financial Results Call. With me today to discuss the results are Tony Zook, Chief Executive Officer; Abhishek k Jain, Chief Financial Officer; and Warren Stone, President and Chief Operating Officer.

Priya Vedaraman: Thank you, Matthew. Good afternoon, everyone. Welcome to NeoGenomics Q1 2026 financial results call. With me today to discuss the results are Tony Zook, Chief Executive Officer; Abhishek Jain, Chief Financial Officer; and Warren Stone, President and Chief Operating Officer. Additional members of the management team will be available for the Q&A portion of our call. This call is being simultaneously webcast. You will know that we will be advancing through a brief slide presentation to accompany today's call, and we have also made the presentation available on the Investor tab of our website at ir.neogenomics.com.

Speaker #1: Additional members of the management team will be available for the Q&A portion of our call. This call is being simultaneously webcast. You will note that we will be advancing through a brief slide presentation to accompany today's call, and we have also made the presentation available on the Investor tab of our website at ir.neogenomics.com.

Speaker #1: During this call, we will make forward-looking statements regarding our future financial and business performance, plans, future operations, and related expectations with respect to timing and performance, future financial position, future revenue, growth potential and expected growth drivers, projected costs and capital expenditure, prospects and plans, estimated market size and position, and objectives of management and financial guidance.

Priya Vedaraman: During this call, we will make forward-looking statements regarding our future financial and business performance, planned future operations and related expectations with respect to timing and performance, future financial position, future revenue, growth potential and expected growth drivers, projected costs and capital expenditures, prospects and plans, estimated market size and position, and objectives of management and financial guidance. We 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.

Speaker #1: We 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.

Priya Vedaraman: Please refer to the information disclosed on the Safe Harbor statement slide in the deck posted on our website, as well as the information under the heading Risk Factors in our most recent forms, 10-K, 10-Q, 8-K, that we file with the SEC to identify important risks and other factors that may cause our actual results to differ materially from the forward-looking statements. These documents can be found in the Investor section of our website or on the SEC website. During this call, we also 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.

Speaker #1: Please refer to the information disclosed on the Safe Harbor Statements slide in the deck posted on our website, as well as the information 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 materially from the forward-looking statements.

Speaker #1: These documents can be found in the Investor section of our website or on the SEC's website. During this call, we also refer to certain non-GAAP financial measures that involve adjustments to GAAP results.

Speaker #1: 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.

Speaker #1: 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 afternoon, and in the slide deck available in the Investor section of our website.

Priya Vedaraman: 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 afternoon and in the slide deck available in the Investor section of our website. I will now turn the call over to Tony.

Speaker #1: I will now turn the call over to Tony.

Speaker #2: Thank you, Priya. And welcome, everyone. For those of you who are relatively new to the NeoGenomics story, let me review our investment thesis. We're a pure-play oncology solutions company, leveraging our strong heritage in hematology with pathologists and community hospitals, where we enjoy a leading 25% share across diagnostics and therapy selection.

Tony Zook: Thank you, Priya Vedaraman, welcome everyone. For those of you who are relatively new to the NeoGenomics story, let me review our investment thesis. We're a pure-play oncology solutions company leveraging our strong heritage in hematology with pathologists and community hospitals where we enjoy a leading 25% share across diagnostics and therapy selection. We believe we're highly differentiated from large reference labs as well as specialty diagnostic companies in two regards: the depth and breadth of our portfolio and a relentless focus in the community setting. We believe in the power of our portfolio and see it as a point of competitive distinction and advantage. We reentered the MRD space with RaDaR ST, which we will discuss momentarily, allowing us to address a $20 billion market opportunity where we will continue to leverage our ambition to be a partner of choice among community practices.

Speaker #2: We believe we're highly differentiated from large reference labs, as well as specialty diagnostic companies, in two regards: the depth and breadth of our portfolio, and a relentless focus in the community setting.

Speaker #2: We believe in the power of our portfolio and see it as a point of competitive distinction and advantage. We re-entered the MRD space with Radar ST, which we will discuss momentarily, allowing us to address a $20 billion market opportunity where we will continue to leverage our ambition to be a partner of choice among community practices.

Speaker #2: An importantly, we believe we're well poised to deliver consistent, double-digit revenue growth. As mentioned, it's our desire to be a partner of choice in the community from diagnosis to recurrence monitoring.

Tony Zook: Importantly, we believe we're well-poised to deliver consistent double-digit revenue growth. As mentioned, it's our desire to be a partner of choice in the community from diagnosis to recurrence monitoring. Our foundation and strength in hematology and diagnostic testing affords us a strong platform for growth. We have and will continue to be purposeful with our portfolio transformation, as evidenced by our product launches enabling our penetration into the $13 billion therapy selection market. Now with RaDaR ST, we've reentered the $20 billion MRD market, both of which are enjoying robust growth but are still relatively modest in penetration rates. This portfolio transformation is evident in our selling performance. The 5 NGS products we launched in 2023 that we have consistently tracked contributed 25% of our clinical revenue in Q1. With that, let's highlight some of our key performance metrics for Q1.

Tony Zook: Importantly, we believe we're well-poised to deliver consistent double-digit revenue growth. As mentioned, it's our desire to be a partner of choice in the community from diagnosis to recurrence monitoring. Our foundation and strength in hematology and diagnostic testing affords us a strong platform for growth. We have and will continue to be purposeful with our portfolio transformation, as evidenced by our product launches enabling our penetration into the $13 billion therapy selection market. Now with RaDaR ST, we've reentered the $20 billion MRD market, both of which are enjoying robust growth but are still relatively modest in penetration rates. This portfolio transformation is evident in our selling performance. The five NGS products we launched in 2023 that we have consistently tracked contributed 25% of our clinical revenue in Q1. With that, let's highlight some of our key performance metrics for Q1.

Speaker #2: Our foundation and strength in hematology and diagnostic testing affords us a strong platform for growth. We have, and will continue to be, purposeful with our portfolio transformation, as evidenced by our product launches enabling our penetration into the $13 billion therapy selection market. And now, with Radar ST, we've re-entered the $20 billion MRD market.

Speaker #2: Both of which are enjoying robust growth but are still relatively modest in penetration rates. This portfolio transformation is evident in our selling performance. The five NGS products we launched in 2023 that we have consistently tracked contributed 25% of our clinical revenue in Q1.

Speaker #2: So with that, let's highlight some of our key performance metrics for Q1. During the first quarter, we again delivered double-digit revenue growth, reflecting our ability to generate consistent and predictable sales.

Tony Zook: During Q1, we again delivered double-digit revenue growth, reflecting our ability to generate consistent and predictable sales. Total revenue for Q1 was $186.7 million, representing 11% growth year-over-year, exceeding our guidance. Adjusted EBITDA of $9 million increased 27% over Q1 2025, and the adjusted EBITDA margin increased approximately 60 basis points year-over-year. Our clinical business continued its robust growth, with revenue increasing 14% year-over-year to $171 million. Clinical performance was driven by effective execution of our commercial strategy, enabling volume growth and share gains in all segments of our business. In this quarter, we again saw an improvement in AUP, which reflected an 8% year-over-year growth and volumes growing 6% year-over-year.

Speaker #2: Total revenue for Q1 was $186.7 million, representing 11% growth year over year and exceeding our guidance. Adjusted EBITDA of $9 million increased 27% over the first quarter of 2025, and the adjusted EBITDA margin increased approximately 60 basis points year over year.

Speaker #2: Our clinical business continued its robust growth, with revenue increasing 14% year over year to $171 million. Clinical performance was driven by effective execution of our commercial strategy, enabling volume growth and share gains in all segments of our business.

Speaker #2: In this quarter, we again saw an improvement in AUP, which reflected an 8% year-over-year growth, and volumes growing 6% year over year. Turning to NGS, revenue grew 26%, well ahead of the NGS market growth rate driven by strong volume and AUP growth.

Tony Zook: Turning to NGS, revenue grew 26%, well ahead of the NGS market growth rate, driven by strong volume and AUP growth. Our NGS business now represents about a third of our total clinical revenue. Moving forward, we believe the addition of PanTracer LBx to the PanTracer family, combined with ongoing investments in our field force size and capabilities, will help us to sustain above-market growth for this part of our portfolio. The momentum with which we exited 2025 continued into the Q1. As we have shared, we continue to see above-market growth with our non-NGS clinical business, which should continue to grow in the mid-single-digit range as we take share across all modalities. Importantly, and in line with our overall strategy, our NGS business is scaling at a rate that is three to four times faster than our core clinical business.

Speaker #2: Our NGS business now represents about a third of our total clinical revenue. Moving forward, we believe the addition of Pantracer liquid biopsy to the Pantracer family combined with ongoing investments in our Field Force size and capabilities will help us to sustain above-market growth for this part of our portfolio.

Speaker #2: The momentum with which we exited 2025 continued into the first quarter. As we have shared, we continue to see above-market growth with our non-NGS clinical business, which should continue to grow in the mid-single-digit range as we take share across all modalities.

Speaker #2: Importantly, and in line with our overall strategy, our NGS business is scaling at a rate that is three to four times faster than our core clinical business.

Speaker #2: We're often asked, how do we win in the community setting, and is the growth sustainable? I'm going to ask Warren to step you through our commercial strategy and give you some insight into our early launch experiences with the Pantracer family and Radar ST.

Tony Zook: We're often asked, how do we win in the community setting and is the growth sustainable? I'm going to ask Warren to step you through our commercial strategy and give you some insight into our early launch experiences with the PanTracer family and RaDaR ST.

Speaker #2: Thank you, Tony, and good afternoon, everybody. Our primary focus is the community setting where approximately 80% of patients seek treatment so that they're close to their support structure.

Warren Stone: Thank you, Tony. Good afternoon, everybody. Our primary focus is the community setting, where approximately 80% of patients seek treatment, so they're close to their support structure. Additionally, most patients live an hour or more from the nearest NCI-designated cancer center. To start, we believe that community oncologists prioritize historic patient management and prioritize certainty over possibility. Guidelines drive their decision-making and ensure actionability. With large patient volumes and resource constraints, they choose partners that reduce friction and support confidence treatment decisions. Secondly, our leadership in hematology, where we hold greater than a 25% market share, provides trusted access and creates strong foundation to expand adoption of our broader portfolio. Third, rapid test results directly impact patient outcomes, and our balanced lab network enables industry-leading turnaround times.

Speaker #2: Additionally, most patients live an hour or more from the nearest NTI-designated cancer center. To start, we believe the community oncologists prioritize historic patient management and prioritize certainty over possibility.

Speaker #2: Guidelines drive their decision-making and ensure actionability. With large patient volumes and resource constraints, they choose partners that reduce friction and support confident treatment decisions.

Speaker #2: Secondly, our leadership in hematology, where we hold greater than a 25% market share, provides trusted access and creates a strong foundation to expand adoption of our broader portfolio.

Speaker #2: Third, rapid test results directly impact patient outcomes. And our balanced lab network enables industry-leading turnaround times. The Pathline acquisition strengthened our Northeast presence and grew at 1.5 times our national average, demonstrating the power of local scale to drive service and growth.

Warren Stone: The Pathline acquisition strengthened our Northeast presence and grew at 1.5 times our national average, demonstrating the power of local scale to drive service and growth. Our portfolio spans over 500 tests across diagnosis, therapy, selection, and MRD, positioning us as a true partner in patient management. We have developed over 330 interfaces, including the recently announced Epic Aura, which for published third-party research, could drive a 20% to 30% increase in test adoption per site. This position is also supported by a broad commercial payer network of more than 300 contracts, also minimizing friction for both providers and patients. We simplify the complexity of oncology diagnostics, so physicians can focus on delivering the best possible patient care. Turning now to RaDaR ST, a circulating tumor DNA assay with exceptional sensitivity for early detection of molecular residual disease.

Speaker #2: Finally, our portfolio spans over 500 tests across diagnosis, therapy selection, and MRD, positioning us as a true partner in patient management. We have developed over 330 interfaces, including the recently announced Epic Aura, which, for published third-party research, could drive a 20% to 30% increase in test adoption per site.

Speaker #2: This position is also supported by than 300 contracts, also minimizing friction for both providers and patients. In summary, we simplify the complexity of oncology diagnostics so physicians can focus on delivering the best possible patient care.

Speaker #2: Turning now to Radar ST, our circulating tumor DNA assay with exceptional sensitivity for early detection of molecular residual disease. In late February, we announced the full clinical launch of Radar ST, which has detection as low as 1 ppm.

Warren Stone: In late February, we announced the full clinical launch of RaDaR ST, which has detection as low as 1 ppm. The launch targets two approved indications, HPV negative head and neck cancer, and a subset of breast cancer. In addition, we have submitted to MolDX for reimbursement in two additional cancer indications, which, if granted, would more than double our market opportunity. Early insights from the RaDaR ST launch to date are very encouraging. Approximately 29% of customers who previously used RaDaR 1.0 have ordered RaDaR ST since launch. Additionally, 34% of RaDaR ST orders received include additional Neo tests. All test results to date have been delivered faster than our published turnaround times. RaDaR ST represents a very important advancement in MRD testing. With its clinical launch, we now offer a comprehensive solid tumor solution spanning diagnosis profiling, therapy selection, and MRD.

Speaker #2: The launch target's two approved indications: HPV-negative head and neck cancer, and a subset of breast cancer. In addition, we have submitted to MOLDEX for reimbursement in two additional cancer indications which, if granted, would more than double our market opportunity.

Speaker #2: Early insights from the Radar ST launch to date are very encouraging. Approximately 29% of customers who previously used Radar 1.0 have ordered Radar ST since launch.

Speaker #2: Additionally, 34% of Radar ST orders received include additional neo tests. All test results to date have been delivered faster than our published turnaround times.

Speaker #2: Radar ST represents a very important advancement in MRD testing, and with its clinical launch, we now offer a comprehensive solid tumor solution spanning diagnosis profiling, therapy selection, and MRD.

Speaker #2: Looking ahead, we are focused on looking ahead, we are focused on targeted R&D investments in whole genome sequencing, including our next-generation MRD assay and whole genome solution for HEME.

Warren Stone: Looking ahead, we are focused on targeted R&D investments in whole genome sequencing, including our next-generation MRD assay and whole genome solution for Heme. The strengthening of our pipeline increases durability and positions us effectively to address future market needs. Our next-generation MRD platform is progressing well, with data generation expected next year and a potential launch as early as 2028. In parallel, we're advancing our non-clinical portfolio to meet the evolving needs of the pharma. This includes expanding our MRD offerings with an off-the-shelf single-tube AML flow panel designed for broader applications across CLL, B-ALL, and multiple myeloma, as well as enhancing our IHC menu with five new CDx-relevant markers. Turning to our PanTracer portfolio, an integrated solution for solid tumor therapy selection designed to combine tissue and liquid testing to deliver confident, actionable insights for real-time treatment decisions.

Speaker #2: This strengthening of our pipeline increases durability and positions us effectively to address future market needs. Our next-generation MRD platform is progressing well, with data generation expected next year and a potential launch as early as 2028.

Speaker #2: In parallel, we're advancing our non-clinical portfolio to meet the evolving needs of the pharma. This includes expanding our MRD offering with an off-the-shelf single-tube AML flow panel designed for border applications across CLL, BALL, and multiple myeloma, as well as enhancing our IHC menu with five new CDX-relevant markers.

Speaker #2: Turning to our Pantracer portfolio, our integrated solution for solid tumor therapy selection, designed to combine tissue and liquid testing to deliver confidence, actionable insights for real-time treatment decisions.

Speaker #2: Pantracer liquid is a non-invasive blood-based test that analyzes circulating tumor DNA to identify key genomic alterations that inform treatment decisions in patients with advanced-stage tumors.

Warren Stone: PanTracer LBx is a non-invasive blood-based test that analyzes circulating tumor DNA to identify key genomic alterations that inform treatment decisions in patients with advanced-stage tumors. With MolDX reimbursement received, we expect revenue contributions to ramp throughout the year. The expansion of PanTracer family with PanTracer Pro turns a very fragmented, so sorry, tumor physician workup into a coordinated and accelerated workflow from a single sample. It fully integrates the therapy selection workflow by combining comprehensive genomic profiling with immunohistochemistry and other auxiliary tests, allowing oncologists to manage the entire cancer diagnostic workflow from a single requisition and sample. This allows for faster test turnaround and a more timely clinical decision-making. Slide 13 illustrates a typical PanTracer workflow. After the test requisition is received, the pathology report is reviewed, an ovarian cancer diagnosis is confirmed.

Speaker #2: With MOLDEX reimbursement received, we expect revenue contributions to ramp throughout the year. The expansion of Pantracer family with Pantracer Pro turns a very fragmented tumor physician sorry, tumor physician workup into a coordinated and accelerated workflow from a single sample.

Speaker #2: It fully integrates the therapy selection workflow by combining comprehensive genomic profiling with immunohistochemistry and other auxiliary tests. Allowing oncologists to manage the entire cancer diagnostic workflow from a single requisition and sample.

Speaker #2: This allows for faster test turnaround and a more timely clinical decision-making. Slide 13 illustrates a typical Pantracer workflow. After the test requisition is received, the pathology report is reviewed and a variant cancer diagnosis is confirmed.

Speaker #2: The oncotree then identifies the guideline-relevant add-on tests. In this case, five medically necessary assays, including the recently launched PDL122C3FDA for ovarian carcinomas, are included.

Warren Stone: The OncoTree identifies the guideline-relevant add-on tests. In this case, 5 medically necessary assays, including the recently launched PD-L1 22C3 FDA for ovarian carcinomas, are included. The slides are prepared, and the test is performed. The add-on results are reported to the physician by day 4, and the NDS results reported on by day 8. As part of our go-to-market strategy, we've expanded our sales force to increase reach and frequency and accelerate penetration in therapy selection and MRD markets. The commercial expansion, coupled with the only MolDX-approved HPV negative test currently available, positions us to accelerate adoption. We plan to add roughly 25 sales resources by Q3 of this year to support the launch and penetration of RaDaR ST in 2 new indications, which we have submitted to MolDX.

Speaker #2: The slides are prepared and the test is performed. The add-on results are reported to the physician by day four, and the NDH results are reported on by day eight.

Speaker #2: As part of our go-to-market strategy, we've expanded ourselves to increase reach and frequency and accelerate penetration in therapy selection and MRD markets. The commercial expansion, coupled with the only MOLDEX-approved HPV-negative test currently available, positions us to accelerate adoption.

Speaker #2: We plan to add roughly 25 cells resources by the third quarter of this year to support the launch and penetration of Radar ST and two new indications, which we have submitted to MOLDEX.

Speaker #2: In summary, we are very pleased with our performance, both financially and strategically in the first quarter, and we are excited for the business levers that are available for us to drive improved and accelerated financial performance in the future.

Warren Stone: In summary, we are very pleased with our performance, both financially and strategically in Q1. We are excited for the business levers that are available for us to drive improved and accelerated financial performance in the future. With that, I'll hand over to Abhishek to further discuss our results for the quarter.

Speaker #2: With that, I'll hand over to Abhishek to further discuss our results for the quarter.

Speaker #1: Thank you, Warren, and good afternoon, everyone. In my remarks today, I will discuss our first quarter financial results and revised 2026 guidance. We reported total revenue of $186.7 million, up 11% year over year.

Abhishek Jain: Thank you, Warren. Good afternoon, everyone. In my remarks today, I will discuss our Q1 financial results and revised 2026 guidance. We reported total revenue of $186.7 million, up 11% year over year, driven by clinical revenue of $171.2 million, which grew a strong 14%. This performance was driven by healthy underlying demand, with volumes up 6% and AUP increasing 8% as compared to the same quarter last year. Same-store revenue, excluding Pathline, was $167.9 million, representing 12% growth versus the prior year period, driven by a 3% increase in test volumes and a 9% increase in AUP. Importantly, both clinical test volumes and AUP growth performed at the high end of our expectations despite the anticipated impact of strategically exiting a high volume, low value contract.

Speaker #1: Driven by clinical revenue of $171.2 million, which drew a strong 14%. This performance was driven by healthy underlying demand with volumes up 6% and AUP increasing 8% as compared to the same quarter last year.

Speaker #1: Same-store revenue, excluding Pathline, was $167.9 million, representing 12% growth versus the prior year period. Driven by a 3% increase in test volumes and a 9% increase in AUP.

Speaker #1: Importantly, both clinical test volumes and AUP growth performed at the high end of our expectations, despite the anticipated impact of strategically exiting a high-volume, low-value contract.

Speaker #1: Most encouraging is the ongoing makeshift towards the high-value testing driven by strong performance in our NGS business that was up 26% year over year, and now represents approximately one-third of our clinical revenue.

Abhishek Jain: Most encouraging is the ongoing mix shift towards the high-value testing driven by strong performance in our NGS business that was up 26% year over year and now represents approximately 1/3 of our clinical revenue. Our targeted investments in the sales team are delivering tangible results and supporting this continued momentum in our NGS business. This favorable mix shift towards high-value testing is also contributing meaningfully to drive AUP growth of 8% year over year. AUP increase was also supported by our cost-saving initiatives, including managed care pricing gains and improved pull-through. Turning to our non-clinical business. We reported $15.5 million in revenue, a decline of 15% year over year, primarily driven by expected softness in pharma. Our Oncology business delivered double-digit growth that helped partially offset the declines in pharma.

Speaker #1: Our targeted investments in the sales team are delivering tangible results and supporting this continued momentum in our NGS business. Further, this favorable makeshift towards high-value testing is also contributing meaningfully to drive year.

Speaker #1: AUP increase was also supported by our RC initiatives including managed care pricing gains and improved pull-through. Turning to our non-clinical business, we reported 15.5 million in revenue at the climb of 15% year over year primarily driven by expected softness in pharma.

Speaker #1: Our ODS business delivered double-digit growth that helped partially offset the declines in pharma. We believe that we are near the bottom for this business and expect to see sequential growth in the back half of the year.

Abhishek Jain: We believe that we are near the bottom for this business and expect to see sequential growth in the back half of the year. Adjusted gross profit improved by $7 million or 9% over the prior year, and adjusted gross margin was 46%, down 80 basis points as compared to last year. As expected, the decline in the gross margin in Q1 was primarily driven by the dilutive impact of Pathline acquisition and the launch of PanTracer liquid prior to MolDX approval. Together, these factors represented approximately under 50 basis points of headwind in Q1 2026. In addition, we were impacted by higher freight costs and fuel surcharges due to the geopolitical situation. These headwinds were partially offset by the gross margin expansion, primarily driven by AUP increase and lab efficiency.

Speaker #1: Adjusted gross profit improved by 7 million or 9% over the prior year and adjusted gross margin was 46%, down 80 basis points as compared to last year.

Speaker #1: As expected, the decline in the gross margin in the first quarter was primarily driven by the dilutive impact of the Pathline acquisition and the launch of Pantracer Liquid prior to MOLDEX approval.

Speaker #1: Together, these factors represented approximately 150 basis points of headwind in Q1 '26. In addition, we were impacted by high freight costs and future charges due to the geopolitical situation.

Speaker #1: These headwinds were partially offset by the gross margin expansion primarily driven by AUP increase and lab efficiency. Looking ahead, we continue to expect gross margin expansion of approximately 100 basis points year over year in 2026, driven by our lab off the future initiatives, which includes strategic sourcing, distant pathology, lab automation, and platform upgrades.

Abhishek Jain: Looking ahead, we continue to expect gross margin expansion of approximately 100 basis points year-over-year in 2026, driven by our Lab of the Future initiatives, which includes strategic sourcing, digital pathology, lab automation, and platform upgrades. We also expect margin progression to benefit from easier compares in the coming quarters. Total operating expenses in the quarter were $99 million, a decrease of $2 million or 2% from prior year. We plan to make targeted investments in our sales and R&D functions to drive clinical test volumes and higher AUP, while continuing to improve leverage in G&A, which we expect to continue to decline as a percentage of revenue. Adjusted EBITDA was $9 million, up 27% year-over-year, and the adjusted EBITDA margin expanded 60 basis points.

Speaker #1: We also expect margin progression to benefit from easier compares in the coming quarters. Total operating expenses in the quarter were $99 million, a decrease of 2 million or 2% from prior year.

Speaker #1: We plan to make targeted investments in our sales and R&D functions to drive clinical test volumes and higher AUP, while continuing to improve leverage in G&A, which we expect will benefit revenue.

Speaker #1: Adjusted EBITDA was $9 million, up 27% year over year, and the adjusted EBITDA margin expanded 60 basis points. This margin expansion was driven by operating leverage in our G&A function that more than offset the headwinds from adjusted gross margin reduction.

Abhishek Jain: This margin expansion was driven by operating leverage in our G&A function that more than offset the headwinds from adjusted gross margin reduction. Cash used in operations was $8.1 million in the quarter, down from approximately $25.3 million in the same quarter last year. We ended the quarter with total cash of $146 million. Our goal continues to be free cash flow positive this year. Turning now to our 2026 guidance. Considering our strong Q1 revenue performance and earlier than assumed MolDX approval of PanTracer LBx in March, we are increasing our full year revenue guidance to a range of $797 to 803 million, up from $793 to 801 million previously. The key assumptions underlying the midpoint of our revenue guidance are as follows.

Speaker #1: Cash used in operations was $8.1 million in the quarter, down from approximately $25.3 million in the same quarter last year. We ended the quarter with total cash of $146 million.

Speaker #1: Our growth continues to be free cash flow positive this year. Turning now to our 2026 guidance. Considering our strong first quarter revenue performance and earlier-than-assumed MOLDEX approval of Pantracer Liquid in March, we are increasing our full-year revenue guidance to a range of $797 to $803 million, up from $793 to $801 million previously.

Speaker #1: The key assumptions underlying the midpoint of our revenue guidance are as follows. First, no change in Radar ST revenue assumptions, which remains in the mid-single-digit millions.

Abhishek Jain: First, no change in RaDaR ST revenue assumptions, which remains in the $mid-single-digit millions. Second, we expect PanTracer Liquid revenue to be in $mid-single-digit millions following MolDX approval in early March. Third, no change in revenue assumptions for our non-clinical business, which we expect to be down low-to-mid-single digits year-over-year in 2026. Regarding the quarterly cadence, we now suggest modeling approximately 9% year-over-year growth in Q2, up from 8% to 9% range previously discussed, followed by 9% to 10% growth in Q3 and above 10% in Q4 of 2026. Turning to gross margin, no change in our guidance, and we expect approximately 100 basis points of gross margin expansion in 2026, driven by a combination of factors we discussed earlier.

Speaker #1: Second, we expect Pantracer Liquid revenue to be in the mid-single-digit millions following MOLDEX approval in early March. Third, no change in revenue assumptions for our non-clinical business, which we expect to be down low to mid-single digits year over year in 2026.

Speaker #1: Regarding the quarterly cadence, we now suggest modeling approximately 9% year over year growth in the second quarter up from 8 to 9% range previously discussed.

Speaker #1: Followed by 9% to 10% growth in the third quarter, and above 10% in the fourth quarter of 2026. Turning to gross margin, there is no change in our guidance, and we expect approximately 100 basis points of gross margin expansion in 2026, driven by a combination of factors we discussed earlier.

Speaker #1: We are maintaining and reiterating our full-year 2026 adjusted EBITDA guidance of 55 to 57 million, representing year over year growth of approximately 27 to 31%.

Abhishek Jain: We are maintaining and reiterating our full year 2026 adjusted EBITDA guidance of $55 to 57 million, representing year-over-year growth of approximately 27% to 31%. As discussed previously, adjusted EBITDA was impacted by higher freight costs and fuel surcharges due to geopolitical environment. We have taken actions to offset these pressures while remaining committed to our previously communicated adjusted EBITDA guidance. With that, let me turn the call over to Tony.

Speaker #1: As discussed previously, adjusted EBITDA was impacted by high freight costs and future charges due to geopolitical environment. We have taken actions to offset these pressures while remaining committed to our previously communicated adjusted EBITDA guidance.

Speaker #1: With that, let me turn the call over to Tony.

Speaker #2: Thanks, Abhishek. Reviewing the significant catalysts for the year, I'm very pleased with our progress to date. We launched Radar ST and head and neck in a subset of breast cancers, and received MOLDEX reimbursement for Pantracer liquid biopsy.

Tony Zook: Thanks, Abhishek. Reviewing the significant catalysts for the year, I'm very pleased with our progress to date. We launched RaDaR ST in head and neck and a subset of breast cancers, received MolDX reimbursement for PanTracer LBx, and we continue to drive NGS growth well ahead of market growth rates. Looking out to the remainder of the year, we anticipate MolDX reimbursement decisions for 2 additional RaDaR ST indications, which if granted, would double the population of patients eligible for this advanced MRD test. We're also advancing plans to expand our sales force by Q3 to capture these additional opportunities that are emerging in advanced cancer testing. Taken together, I believe these catalysts form a solid foundation from which to drive future growth. I'll close by outlining how we're driving accelerated financial performance through disciplined execution across our key business levers.

Speaker #2: And we continue to drive NGS growth well ahead of market growth rates. Looking out to the remainder of the year, we anticipate MOLDEX reimbursement decisions for two additional Radar ST indications, which, if granted, would double the population of patients eligible for this advanced MRD test.

Speaker #2: We're also advancing plans to expand our sales force by the third quarter to capture these additional opportunities that are emerging in advanced cancer testing.

Speaker #2: Taken together, I believe these catalysts form a solid foundation from which to drive future growth. I'll close by outlining how we're driving accelerated financial performance through discipline execution across our key business leaders.

Speaker #2: The launch of Radar ST and MOLDEX approval for liquid biopsy have opened up large addressable markets, and we're focused on driving adoption, alongside continued expansion into new indications and advancement of our next-generation MRD programmers.

Tony Zook: The launch of RaDaR ST and MolDX approval for liquid biopsy have opened up large addressable markets, we're focused on driving adoption alongside continued expansion into new indications and advancement of our next generation MRD programs. Commercial initiatives across sales, pricing, and payer coverage are improving access and monetization, while ongoing investments in automation, platform upgrades, and lab optimization are enhancing efficiency and scalability. Together, these efforts position us well for sustained growth in 2026 and beyond. Thank you for your continued interest in NeoGenomics. Operator, this concludes our prepared remarks, so please open up the line for questions.

Speaker #2: Commercial initiatives across sales, pricing, and payer coverage are improving access and monetization, while ongoing investments in automation, platform upgrades, and lab optimization are enhancing efficiency and scalability.

Speaker #2: Together, these efforts position us well for sustained growth in 2026 and beyond. Thank you for your continued interest in NeoGenomics, and operator, this concludes our prepared remarks.

Speaker #2: So, please open up the line for questions.

Speaker #1: Certainly. Everyone at this time will be conducting a question-and-answer session. If you have any questions or comments, please press star 1 on your phone at this time.

Matthew: Certainly. Everyone at this time will be conducting a question and answer session. If you have any questions or comments, please press star one on your phone at this time. We do ask that while posing your question, please pick up your handset if you're listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone. Your first question's coming from David Westenberg from Piper Sandler. Your line is live.

Operator: Certainly. Everyone at this time will be conducting a question and answer session. If you have any questions or comments, please press star one on your phone at this time. We do ask that while posing your question, please pick up your handset if you're listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone. Your first question's coming from David Westenberg from Piper Sandler. Your line is live.

Speaker #1: We do ask that, while posting your question, please pick up your handset if you're listening on speakerphone to provide optimum sound quality. And once again, if you have any questions or comments, please press star 1 on your phone.

Speaker #1: Your first question is coming from David Westenberg from Piper Sandler. Your line is live.

Speaker #3: Hi. Thanks for taking the question, and congrats on all the growth. So I want to focus on the positive here. The NGS growth has been robust.

David Westenberg: Hi. Thanks for taking the question and congrats on all the growth. I want to focus on the positive here. The NGS growth has been robust. You've been tracking in the mid-twenties for a long time, you know, you are facing difficult comps. As we model the durability of the growth algorithm, can you talk about NGS predicated on or growth predicated on PanTracer Liquid versus tissue? How should we see that mixed growth? Can that help you sustain kind of that 20% range? Secondly, how do we think about the AUP over the next couple of years as this starts to ramp? I'll ask one small follow-up.

Speaker #3: You've been tracking in the mid-20s for a long time, but you are facing difficult comps. As we model the durability of the growth algorithm, can you talk about NGS predicated on our growth predicated on Pantracer liquid versus tissue?

Speaker #3: How should we see that mixed growth? Can that help you sustain kind of that 20% range? And then secondly, how do we think about the AUP over the next couple of years as this starts to ramp?

Speaker #3: And I have all ask one small follow-up.

Speaker #2: Okay, Dave. So thanks for the question. I'll kick us off, and then Warren can fill in some color as well. First, on the sustainability of the NGS, I appreciate the question, right?

Tony Zook: Okay, Dave. Thanks for the question. I'll kick us off and then Warren can fill in some color as well. First, on the sustainability of the NGS, I appreciate the question, right? I mean, we are showing really good growth in NGS. As we said, 26% revenue growth, and that was driven by 16% volume growth. If you turn back the hands of time, we closed last year, I think 23% in the quarter of Q4, and we did 22% for the year. At the time, we said we thought that we were able to be able to sustain that at a minimum, if not even beat it with the addition of PanTracer LBx. We look at where we sit right now, Dave, and we feel very good.

Speaker #2: I mean, we are showing really good growth in NGS, as we said, 26% revenue growth, and that was driven by 16% volume growth. If you turn back the hands of time and closed last year, I think 23% in the quarter of Q4, and we did 22% for the year.

Speaker #2: And at the time, we said we thought that we were able to sustain that at a minimum, if not even beat it, with the addition of Pantracer LDX.

Speaker #2: And so we look at where we sit right now, Dave, and we feel very good. The early products that we mentioned before—they were up to 25% of our clinical revenue in the quarter.

Tony Zook: The early products that we mentioned before, they were up to 25% of our clinical revenue in the quarter. Early days of PanTracer are showing really good signs for us. Warren can go into a bit more detail on PanTracer LBx. Even PanTracer Pro, which was introduced in the mid of February, you know, we're seeing it now almost cover 10% of PanTracer volume, which is exciting because it's captured 15% of new users, Dave. You know, we absolutely do think that it's sustainable. With the addition of liquid biopsy to the family, we think it can go even further. With that, maybe I'll turn it over to Warren to give a little bit more color on LBx, then we'll get to the AUP piece.

Speaker #2: Early days of Pantracer are showing really good signs for us. Warren can go into a bit more detail on Pantracer LDX, but even Pantracer Pro, which was introduced in the middle of February, we're seeing it now almost cover 10% of Pantracer volume, which is exciting because it's captured 15% of new users, Dave.

Speaker #2: So we absolutely do think that it's sustainable, and with the addition of liquid biopsy to the family, we think it can go even further.

Speaker #2: And with that, maybe I'll turn it over to Warren to give a little bit more color on LDX, and then we'll get to the AUP question.

Speaker #3: Yeah, you covered a lot of ground there, Tony. I'd say that the Pantracer family, for us, we really look at the category growth overall, because the tissue and the liquid get used sort of concurrently, or certainly as a reflex to QNS TMPs that might take place on tissue, or as a standalone.

Warren Stone: You've covered a lot of ground there. I'd say that, you know, the PanTracer is family for us. We really look at the category growth overall because the tissue and the liquid get used sort of concurrently or certainly as a reflex to QNS and TMP that might take place on tissue or as a standalone. It is really versatile, and we are encouraged by the attractive growth that we've seen from the category overall, including liquid. If you look through, you would've seen a graph in the presentation which showed a 16% volume growth at a 26% revenue growth. That acceleration in revenue growth is coming because we're moving towards these larger CGP panels. That's driving the growth, and that's also helping the AUP.

Speaker #3: So it is really, really versatile. And we're encouraged by the attractive growth that we're seeing from the category overall. Including liquid, and if you look through, you would have seen a graph in the presentation which showed a 60% volume growth, but a 26% revenue growth.

Speaker #3: And that acceleration in revenue growth is coming because we're moving towards these larger CGP panels. That's driving the growth, and that's also helping the AUP.

Speaker #3: So to your question on the sustainability to stay above those sort of the 20% mark is certainly Pantracer liquid, but Pantracer family as a whole is going to be a key driver for us.

Warren Stone: To your question on our ability, the sustainability to stay above those sort of the 20% mark, certainly PanTracer is the liquid, but PanTracer as a family as a whole is gonna be a key driver for us.

Speaker #2: And then Dave, on AUP, again, very, very strong performance there. We were up 8% year over year, and I would say that's indicative of the strategy, right?

Tony Zook: Dave, on AUP, again, very, very strong performance there. We were up 8% year over year, and I would say that's indicative of the strategy, right? We've been very purposeful saying that we are going to drive growth with that NGS portfolio of ours. You know, increasing it as a percentage of our business, which is now up to a third of our business, and we're growing it, that's going to have a big contributing factor to AUP. I would say as well, about half of it is driven by the great work that the team does behind the scenes on the RCM initiatives.

Speaker #2: We've been very purposeful saying that we are going to drive growth with that NGS portfolio of ours. And so increasing it as a percentage of our business, which is now up to a third of our business, and when we're growing it, that's going to have a big contributing factor to AUP.

Speaker #2: But I would say as well, about half of it is driven by the great work that the team does behind the scenes on the RCM initiatives.

Speaker #2: We talk about the 300 contracts, but we look at those contracts all the time, and every opportunity we have to increase price there, do direct price increases, and all of those initiatives add up.

Tony Zook: Like, you know, we talk about the 300 contracts, but, you know, we look at those contracts all the time and every opportunity we have to, you know, increase price there, to do, you know, direct price increases. All of those initiatives add up. We believe the AUP is also sustainable this year. Again, about half of that is driven by mix and the increased volume in NGS, and about half is just the good work behind the scenes. Maybe one final point just as kind of the icing on the cake with AUP, while NGS is the big driver there, Dave, and I know that's how you were focused the question, good news is we're seeing AUP increase contributions across all of the modalities. It's, it's not just NGS that's contributing, it's the portfolio.

Speaker #2: And so we believe the AUP is also sustainable this year and, again, about half of that is driven by mixed and the increased volume in NGS, and about half is just the good work behind the scenes.

Speaker #2: And maybe one final point just as kind of the icing on the cake with AUP, while NGS is the big driver there, Dave, and I know that's how you were focused the question, the good news is we're seeing AUP increase contributions across all of the modalities.

Speaker #2: And so it's not just NGS that's contributing. It's the portfolio.

Speaker #3: Got it. Actually, that was a really long answer. So I mean, long answer. So I'll just hop off. Thanks so much.

David Westenberg: Got it. Actually, that was a really long answer, so I'll just hop off. Thanks so much.

Speaker #2: All right. Thank you, Dave. Thanks, Dave.

Tony Zook: All right. Thank you, Dave.

Matthew: Thank you.

David Westenberg: Thank you.

Speaker #1: Your next question is coming from Tycho Peterson from Jefferies. Your line is live.

Tony Zook: Thanks, Dave.

Matthew: Your next question is coming from Tycho Peterson from Jefferies. Your line is live.

Operator: Your next question is coming from Tycho Peterson from Jefferies. Your line is live.

Speaker #3: Hey, thanks. Maybe one final check just on the guidance raise—in the past, you've gotten over your skis with raising guidance only to cut later.

Tycho Peterson: Hey, thanks. Maybe one for Abhishek just on the guidance raise. You know, in the past, you've gotten over your skis with raising guidance to cut later. I guess, you know, why not bank the beat and de-risk the re-remainder of the year? Or, you know, conversely, can you point to, you know, what's trending more positive? Was it April data points? You know, the new launches obviously you've talked to, but you know, maybe get us comfortable that guidance is still conservative and beatable here.

Speaker #3: I guess why not bank the beat and de-risk the remainder of the year or conversely, can you point to what's trending more positive? Was it April data points, the new launches?

Speaker #3: Obviously, you've talked to it, but maybe get us comfortable that guidance is still conservative and beatable here.

Speaker #2: Yeah, sure. Be happy to. And then again, I'll let Abhishek jump in on the details. Relative to the guidance, Tycho, you're right. We want to maintain the philosophy that we shared with you, right?

Tony Zook: Yeah, sure. Be happy to, and again, I'll let Abhishek jump in on the details. Relative to the guidance, Tycho, you're right. We wanna maintain the philosophy that we shared with you, right? That is when we issue our guide, you ask us to only speak with a high degree of confidence, not just with the center point of that guide, but making sure we can get to the upper end of that guide at a minimum. We've taken those factors into consideration with this guide. You know, what are the positives? What do we look towards? Well, again, 11% revenue, but it was driven by 14% clinical revenue growth. So that is certainly a driver, and the NGS is a driver for us to be certain.

Speaker #2: And that is when we issue our guide. You asked us to only speak with a high degree of confidence, not just with the center point of that guide, but making sure we can get to the upper end of that guide at a minimum.

Speaker #2: And we've taken those factors into consideration with this guide. What are the positives? What do we look towards? Well, again, 11% revenue, but it was driven by 14% clinical revenue growth.

Speaker #2: And so that is certainly a driver. And the NGS is a driver for us, to be certain. And so, based on the middle of that guide, where do we see potential opportunity, and where is there some risk?

Tony Zook: Based on the middle of that guide, where do we see potential opportunity and where is there some risk? I would say the opportunity is certainly with the NGS portfolio, with emphasis on PanTracer LBx. Getting another quarter of opportunity to drive revenue, getting out in front with commercial payers. You know, if we can plow that field well, we think there is probably upside opportunity associated with the guide relative to PanTracer LBx. We think that there is potential opportunity as well in our non-clinical business. You know, it's way too early to spike the football there, which is why we still want to be relatively conservative. We're seeing early signs that, in fact, we're planning and hitting what we said, which would be kind of that low single-digit erosion on the non-clinical side.

Speaker #2: I would say the opportunity is certainly with the NGS portfolio, with emphasis on Pantracer LDX—getting another quarter of opportunity to drive revenue, getting out in front with commercial payers. If we can plow that field well, we think there is probably upside opportunity associated with the guide relative to Pantracer LDX.

Speaker #2: We think that there is potential opportunity as well in our non-clinical business. It's way too early to spike the football there, which is why we still want to be relatively conservative.

Speaker #2: But we're seeing early signs that, in fact, we're planning and hitting what we said, which would be kind of that low single-digit erosion on the non-clinical side.

Speaker #2: So there's some risk there, but we think that it's taken into account at this point. I guess the other area of opportunity for us would be even better uptake with Radar ST.

Tony Zook: You know, there's some risk there, but we think that it's taken into account at this point. I guess the other area of opportunity for us would be even better uptake with RaDaR ST. Again, we're playing this one right down the middle, Tycho, with the, you know, single millions in the middle of the guide. I guess if the additional indications were to come on board sooner than we thought, that could represent some upside. We do see some potential, you know, risk, which would be on the non-clinical side. That's not a new story to you. We see the rate of decline of that business beginning to slow and activity beginning to pick up. On balance, we would say there's probably more opportunity than downside against what we've shared with you today.

Speaker #2: But again, we're playing this one right down the middle, Tycho, with a single million in the middle of the guide. And I guess if the additional indications were to come on board sooner than we thought, that could represent some upside.

Speaker #2: And so we do see some potential risk, which would be on the non-clinical side. That's not a news story to you. But we see the rate of decline of that business beginning to slow.

Speaker #2: And activity beginning to pick up. And so, on balance, we would say there's probably more opportunity than downside against what we've shared with you today.

Speaker #2: Does that help?

Tony Zook: Does that help?

Speaker #3: That does. That does. Another question is you passed my next quarter. I guess how do we think about the volume growth as you lap that?

Tycho Peterson: That does. That does. You know, another question is you lap Pathline next quarter. I guess, how do we think about the volume growth as you lap that? You know, you grew volumes 2.8% ex Pathline. Is that kind of the right run rate for the business? You're rolling off the big lab contract, so how do we think about just lapping Pathline?

Speaker #3: You grew volumes 2.8% X past line. Is that kind of the right run rate for the business? You're rolling off the big lab contract.

Speaker #3: So how do we think about just lapping past line?

Speaker #2: Well, I think the most important element, and I'll ask Abhishek if you can get into his very specific question on volumes. I've gotten to the point, Tycho, I probably look less at the actual volumes associated with just pure path line because I look at more the Northeast because that was the strategic purpose of having it.

Tony Zook: Well, I think the most important element, then I'll ask Abhishek, he can get into his very specific question on the volumes. You know, I've gotten to the point, Tyko, I probably look less at the actual volumes associated with just pure Pathline because I look at more the Northeast because that was the strategic purpose of having it. What we have seen is our growth rate in the Northeast region was one and a half times faster than the other regions, that's a first for us. We see the strategic benefit of serving those customers coming through. Our total value associated with Pathline from the Northeast region is absolutely increasing on plan, albeit the actual volumes might be down just a little bit because of the non-oncology, and I'll let Abhishek.

Speaker #2: And what we have seen is our growth rate in the Northeast region was one and a half times faster than the other regions and that's a first for us.

Speaker #2: And so we see the strategic benefit of serving those customers coming through. So our total value associated with path line for the Northeast region is absolutely increasing on plan, albeit the actual volumes might be down just a little bit because of the non-oncology and all that Abhishek takes some of that.

Speaker #3: Yeah. Let me also kind of talk about the overall volume picture there, Tycho, right? Because we basically guided low single-digit for the full year.

Tycho Peterson: Yeah

Tony Zook: take some of that.

Abhishek Jain: Yeah. Let me also kind of talk with the overall volume picture there, Tycho Peterson, right? Because we basically are in low single digits for the full year. We came in at about 6% growth for Q1. As for the guidance, what we are saying that Q2 is going to be flat-ish year-over-year growth standpoint. What will start to happen from now onwards that we'll start to see a sequential growth in our volume in Q2 onwards. That's the good part, right? A lot of the work that for the revenue growth is going to come from the AUP in our remaining quarters for the year. We are basically trying to kind of absorb exiting this high volume, low value contract as we kind of look into Q2 and Q3.

Speaker #3: We came in at about 6% growth for the first quarter. And as for the guidance, what we are saying that the second quarter is going to be flat-ish, year-over-year growth standpoint.

Speaker #3: But what does start to happen from now onwards that will start to see a sequential growth in our volume in Q2 onwards? So that's a good part, right?

Speaker #3: But a lot of the work, or the revenue growth, is going to come from the AUP in our remaining quarters for the year.

Speaker #3: We are basically trying to kind of absorb existing, this high-volume, low-value contract as we kind of look into Q2 and Q3. Q3 '25 was the peak quarter for this particular one contract.

Abhishek Jain: Q3 2025 was a peak quarter for this particular 1 contract, and that's the reason we'll have those headwinds in Q2 and Q3. Overall cases from the overall revenue growth standpoint, as Tony Zook pointed out, on the clinical revenue, we are growing a strong 14% in Q2. Our guide basically still keeps us about 11% above growth for our clinical business for the rest of the year.

Speaker #3: And that's the reason we'll have those headwinds in Q2 and Q3. But overall cases from the overall revenue growth standpoint as Tony pointed out on the clinical revenue, we are growing a strong 14% in the current quarter.

Speaker #3: And our guide basically still keeps us about 11% above growth for our clinical business for the rest of the year. Okay. One last quick one.

Tycho Peterson: Okay.

Speaker #3: Abhishek said, maybe just on the convert, you burned 14 million in cash. You have 146 million in cash and 342 million convert. Do January 2028.

Abhishek Jain: Okay, Tyler.

Tycho Peterson: One last quick one. Maybe just on the convert, you burned $14 million in cash. You have $146 million in cash and $342 million convert due January 2028. Can you maybe just quickly touch on plans for that, and then I will hop off?

Speaker #3: Can you maybe just quickly touch on plans for that? And then I'll hop off.

Speaker #2: No, absolutely, Tycho. So we are actually discussing with many of the leading banks on the convert refinancing. And everybody has told me that this has been a good market, 2025.

Abhishek Jain: Absolutely, Tycho. We are actually discussing with many of the leading banks on the convert refinancing. Everybody has told me that this has been a good market, 2025, and what we have seen in 2026. We are getting that there will not be any challenge in terms of refinancing the convert. We are trying to basically make sure that we are able to get the currency of our stock, which we believe is highly underappreciated, kind of come back to a level where we feel that this is the right time for us to kind of do the refinancing. In any case, our plan is to get the refinancing done in H2 of the year. We do not want to leave this open for fairly late in the game.

Speaker #2: And what we have seen in 2026. We are getting that there will not be any challenge in terms of refinancing the convert. We are trying to basically make sure that we are able to get the currency of our stock, which we believe is highly underappreciated.

Speaker #2: Kind of come back to a level where we feel that this is the right time for us to kind of do the refinancing. But in any case, our plan is to get the refinancing done in the second half of the year.

Speaker #2: We do not want to leave this open for fairly late in the game.

Speaker #3: Okay. Thank you.

Speaker #2: Thanks, Abhishek. Thanks, Tycho.

Tycho Peterson: Okay. Thank you.

Abhishek Jain: Okay. Thank you.

Abhishek Jain: Thanks, Abhishek.

Tycho Peterson: Thanks, Abhishek.

Matthew: Thank you. Your next question's coming from Puneet Souda from Leerink. Your line is live.

Operator: Thank you. Your next question's coming from Puneet Souda from Leerink. Your line is live.

Speaker #1: Thank you. Your next question is coming from Puneet Soda from Lyrinc. Your line is live.

Speaker #4: Hi, guys. Thanks for the questions here. So first one, just wanted to see if there was any weather impact in the quarter and if you are expecting any as a result, they're expecting anything into Q for that.

Puneet Souda: Yeah. Hi, guys. Thanks for the questions here. First one, just wanted to see if there was any weather impact in the quarter and if you're expecting anything into Q2 for that. Also on the NGS side, how should we think about the ceiling? It's a third of your business. It's growing rapidly in the community setting. Just trying to understand, you know, overall NGS, what's the ceiling there? I assume that NGS is all of the solid tumors. Can you clarify the boundaries of NGS? What is included in NGS and what is not?

Speaker #4: And also on the NGS side, how should we think about the ceiling? It's a third of your business. It's growing rapidly in the community setting.

Speaker #4: Just trying to understand overall NGS, what's the ceiling there? And I assume that NGS is all of the solid tumors? Can you clarify the boundaries of NGS?

Speaker #4: What is included in NGS and what is not?

Speaker #2: Sure. So Warren, you'll take a crack at the NGS one. And on the weather, just to be clear, Puneet, when we issued the guide, as you rightfully pointed out, for the first quarter, we had already indicated what we anticipated to be the weather impact.

Abhishek Jain: Sure. Warren, you'll take a crack at the NGS one.

Warren Stone: Yeah.

Abhishek Jain: On the weather, just to be clear, Puneet, when we issued the guide, as you rightfully pointed out, for Q1, we had already indicated what we anticipated to be the weather impact, and it came in pretty much as we expected.

Speaker #2: And it came in pretty much as we expected. And so we don't see any drag or any issues moving forward through Q2. And relative to the NGS question?

Puneet Souda: Sure.

Abhishek Jain: We don't see any drag or any issues moving forward through Q2. Relative to the NGS question.

Speaker #3: Yeah. So I mean, how are we defining NGS today, Puneet, is simply it's NGS for a heme cancer. And it's NGS for a solid tumor.

Warren Stone: Yeah. I mean, how we're defining NGS, Puneet, is simply it's NGS for our heme cancers, and it's NGS for our solid tumor, largely fitting within the therapy selection vertical. At the moment, even though MRD runs on an NGS backbone, we're probably gonna carve that out. The 26% growth that you see, that excludes any MRD. In terms of the outlook, I mean, I'd say we'd be disappointed that if in the midterm this is not more than 40% is sort of how you need to think about that. This is definitely the growth engine of business.

Speaker #3: Largely fitting within the therapy selection vertical. At the moment, even though MRD runs on an NGS backbone, we're probably going to carve that out.

Speaker #3: So the 26% growth that you see, that excludes any MRD. In terms of the outlook, I mean, I'd say we'd be disappointed that if in the midterm this is not more of the 40% is sort of how you need to think about that.

Speaker #3: This is definitely the growth engine for our business. You can see the trajectory since 2022. And the portfolio that we've added in 2023 and have continued to add is going to continue to fuel that growth in the sort of 20% mark.

Warren Stone: You can see the trajectory since 2022, and the portfolio that we've added in 2023 and have continued to add, is gonna continue to fill that growth in the sort of that 20% mark.

Speaker #2: Yeah.

Puneet Souda: Yeah. Got it. Just to follow up, there's obviously a lot of discussions about repeat use of CGP liquid. There's trials, add-ons, other things are taking center stage. When you think about the setting you're serving, you know, when do you think you can start to see some benefit from that, just given, you know, sort of the timing it takes for your test to be, you know, recognized by the market you're serving?

Speaker #4: Got it. And then just to follow up on, there's obviously a lot of discussions about repeat users, CGP liquid. There's trials and cons other things are taking center stage.

Speaker #4: When you think about the setting you're serving, when do you think you can start to see some benefit from that? Just given sort of the timing it takes for your test to be recognized by the market you're serving.

Speaker #2: Yeah. So I think interesting in that we've already seen some repeat testing on liquid biopsy already. So that's encouraging. And I think as the scale continues to grow in the second half of the year as we outlined, we expect to see some repeat testing here as well, which is encouraging.

Warren Stone: Yeah. I think interesting enough, we've already seen some repeat testing on liquid biopsy already. That's encouraging. I think as the scale continues to grow in the H2 of the year, as we outlined, we expect to see some repeat testing here as well, which is encouraging. We also anticipate that as we put more and more patient programs into place to support RaDaR ST, that we can obviously also layer some of those workflows and those applications into liquid biopsy as well. This is certainly part of that growth assumption that you asked about earlier that'll help to continue the momentum.

Speaker #2: And we also anticipate that as we put more and more patient programs into place to support radar ST, that we can obviously also layer some of those workflows and those applications into liquid biopsy as well.

Speaker #2: So this is certainly part of that growth assumption that you asked about earlier that'll help to continue the momentum.

Speaker #4: Got it. Okay. I'll hop back into Q. Thanks.

Puneet Souda: Got it. Okay. I'll hop back in the queue. Thanks.

Speaker #2: Thank you, Puneet.

Speaker #3: Thank you.

Abhishek Jain: Thank you, Puneet.

Speaker #1: Thank you. Your next question is coming from Bill Bonilla from Craig Hallam. Your line is live.

Matthew: Thank you. Your next question's coming from Bill Bonello from Craig-Hallum. Your line is live.

Operator: Thank you. Your next question's coming from Bill Bonello from Craig-Hallum. Your line is live.

Speaker #3: Hey, guys. Thanks a lot. I wanted to ask a little bit about the PAN tracer pro program and just kind of how that works and what you're seeing on that front.

Bill Bonello: Hey, guys. Thanks a lot. I wanted to ask a little bit about the PanTracer Pro program, and just kinda how that, how that works and what you're, you know, what you're seeing on that front. Am I understanding this right that somebody checks that box and then, based on what you see in sort of a, you know, maybe an AI-driven algorithm along with the pathologist's experience. You make a decision about follow-on tests that should be ordered or what complete set of tests should be ordered. Can you give us...

Speaker #3: So, am I understanding this right, that somebody checks that box, and then, based on what you see in sort of maybe an AI-driven algorithm along with the pathologist's experience, you make a decision about follow-on tests that should be ordered or what complete set of tests should be ordered?

Speaker #3: And can you give us you showed a little illustration where you showed one example, but can you give us a sense of comparison in maybe value when physicians are ordering that option versus when they're just selecting a straight-up panel?

Bill Bonello: You showed a little illustration where, you know, you showed one example, but can you give us a sense of, you know, comparison in maybe value when physicians are ordering that option versus when they're just, you know, selecting a straight up panel?

Speaker #2: So I think you've outlined the workflow pretty well. But I think, coming back to one of the things about the system, we want to make that sort of ordering experience as easy as possible.

Warren Stone: Bill, I think you've outlined the workflow pretty well. I think coming back to, you know, one of the things that we try and do is we try to take friction out of the system. We wanna make that sort of ordering experience as easy as possible. Whether you choose to requisition this through a bi-directional interface, a portal, or paper, it's exactly that. It's a one check, and that's it. The requisition will arrive in our lab. Again, this is in the therapy selection vertical, so there's typically a diagnosis that's taken place already. That's the path report that gets read. This algorithm then determines, based on guidelines, and what's medically necessary, this is a key aspect, what additional add-on testing should be performed based on that specific diagnosis.

Speaker #2: And whether you choose to requisition this through a bidirectional interface, a portal, or paper, it's exactly that. It's And the requisition will arrive in our lab.

Speaker #2: And again, this is in the therapy selection vertical. So there's typically a diagnosis that's taking place already. That's the path to reports. That gets read.

Speaker #2: And this algorithm then determines based on guidelines and what's medically necessary. This is a key aspect. What additional add-on testing should be performed based on that specific diagnosis?

Speaker #2: So what add-on testing will vary based on the diagnosis and the example I shared was a variant. And we added on five additional tests, including that new PD-L14 ovarian carcinomas.

Warren Stone: What add-on testing will vary based on the diagnosis. The example I shared was ovarian, and we added on five additional tests, including that new PD-L1 for ovarian carcinomas. The system does that automatically. We cut the slides appropriately because the number of slides that you would cut would be dependent on the number of add-on tests. We will do the testing. We report out the results for the add-on testing as soon as that is available, and that's typically before NGS. The reason why that's valuable is you can get the first indication around what therapies you may wanna put somebody on.

Speaker #2: So the system does that automatically. We then run the we cut the slides appropriately because the number of slides that you would cut would be dependent on the number of add-on tests.

Speaker #2: We will do the testing. We report out the results for the add-on testing as soon as that is available. And that's typically before NGS.

Speaker #2: And the reason why that's valuable is you can get in the first indication around what therapies you may want to put somebody on. And then once the NGS is available, which is typically three or four days thereafter, we'll submit the NGS results to the physician as well so that they have a complete package and they can make it more holistic, informed decision from a treatment perspective.

Warren Stone: Then once the NGS is available, which is typically 3 or 4 days thereafter, we'll submit the NGS results to the physician as well, so that they have a complete package and they can make a more holistic, informed decision from a treatment perspective. You know, it's. In the past, a physician could have done that themselves. They could have figured out, using that ovarian situation, they could have figured out that I want PanTracer tissue, and I want these five markers. They could have done that manually. The reality is, in the community setting, very few actually. They're seeing so many different patients with different indications, they don't know that well. They would typically send PanTracer in and then potentially send that second requisition at a later stage to do some add-on testing. That just takes longer.

Speaker #2: So in the past, a physician could have done that themselves. They could have figured out, using that ovarian situation, they could have figured out that I want PAN tracer tissue and I want these five markers.

Speaker #2: They could have done that manually. But the reality is, in the community setting, very few actually have—they're seeing so many different patients with different indications.

Speaker #2: They don't know that that well. So they would typically send PAN tracer in and then potentially send a second requisition at a later stage to do some add-on testing.

Speaker #2: So that just takes longer. It exhausts more sample. So this really has a lot of efficiencies. And it also does typically result in additional add-on testing, which has a revenue component attached to it.

Warren Stone: It exhausts more samples. This really has a lot of efficiencies, and it also does typically result in additional add-on testing, which has a revenue component attached to it. Wanna stress, it's only what's driven by guidelines and what's medically necessary.

Speaker #2: But I want to stress it's only what's driven by guidelines and what's medically necessary.

Speaker #3: Okay.

Speaker #2: Thanks, Bill.

Speaker #3: Is there any oh, okay.

Bill Bonello: Okay. is there.

Abhishek Jain: Thanks, Bill.

Bill Bonello: Oh, okay.

Speaker #2: Did you have a quick follow-up?

Abhishek Jain: Did you have a quick follow-on?

Speaker #3: That's okay.

Bill Bonello: That's okay.

Speaker #2: Okay.

Abhishek Jain: Okay.

Speaker #1: Thank you. Your next question is coming from Mason Carico from Stevens. Your line is live.

Matthew: Thank you. Your next question's coming from Mason Carrico from Stephens. Your line is live.

Operator: Thank you. Your next question's coming from Mason Carrico from Stephens. Your line is live.

Speaker #3: Hey, guys. Good afternoon. This is Ben on for Mason. Could you help us bridge Q1 reported AOP to the underlying core AOP after adjusting for that low-value contract?

[Analyst]: Hey, guys. Good afternoon. This is Ben on for Mason. Could you help us-

Warren Stone: Mm-hmm.

[Analyst]: -bridge, Q1 reported AUP to the underlying core AUP after adjusting for that low-value contract? I believe some remaining volumes of that contract were expected to flow through in Q1 here.

Speaker #3: I believe some remaining volumes of that contract were expected to flow through in the first quarter here.

Speaker #2: Yeah. I will take that one question. Ben, so we basically drew our AOP by 8%. And year over year, excluding Pathway, the number was 9%.

Abhishek Jain: Yeah. I will take that one question, Ben. We basically grew our AUP by 8% and year-over-year. Excluding Pathline, the number was 9%, and if you were to exclude the impact of the high volume, low value contract, then I would say that it did not impact the AUP change as much because the number of tests, they basically became a smaller number, and there was a little bit of a growth in the AUP that we had seen as we had moved away, like, as we had progressed in 2025 from Q1 onwards. The impact for the high volume, low value test, about 1 point or so in the overall AUP growth.

Speaker #2: And if you were to exclude the impact of the high-volume, low-value contract, then I would say that it did not impact the AOP change as much.

Speaker #2: Because the number of tests, the way they came basically became a smaller number, and there was a little bit of a growth in the AOP that we have seen as we had moved away.

Speaker #2: As we had progressed in 2025 from Q1 onwards. So the impact for the high-volume, low-value test, about a point or so in the overall AOP growth.

Speaker #2: Our AOP growth was primarily driven by, as Tony pointed out, because of the high mix of our high-value testing, which has been part of our ur strategy.

Abhishek Jain: Our AUP growth was primarily driven by, as Puneet pointed out, because of the high mix of our high-value testing, which has been part of our strategy, the NGS growth, as well as the impact of the RRCM work that we have done.

Speaker #2: The NGS growth, as well as the impact of the RCM work that we have done.

Speaker #3: Got it. That makes sense. And then on the two additional radar moldy eggs submissions, has anything changed there in your confidence or the expected timing of when you could get those decisions?

[Analyst]: Got it. That makes sense. On the two additional RaDaR MolDX submissions, has anything changed there in your confidence or the expected timing of when you could get those decisions? Is prior to year-end the right way to think about those?

Speaker #3: Is prior to your end the right way to think about those?

Speaker #2: It is. Yeah. And that's been a consistent assumption that we've shared with you. So yeah, we submitted at the close of last year. We anticipate those could be available to us by the close of this year, which is why we're gearing up the Salesforce in anticipation of being able to address those in the second half of the year.

Tony Zook: It is, yeah, and that's been a consistent assumption that we've shared with you. Yeah, we submitted, you know, at the close of last year. We anticipate those can be available to us by the close of this year, which is why we're gearing up the sales force in anticipation of being able to address those in H2.

Speaker #3: Great. Thanks for taking the questions.

[Analyst]: Great. Thanks for taking the questions.

Speaker #2: Sure thing.

Abhishek Jain: Sure thing.

Speaker #1: Thank you. Your next question is coming from Subhu Nadi from Guggenheim. Your line is live.

Matthew: Thank you. Your next question's coming from Subbu Nambi from Guggenheim. Your line is live.

Operator: Thank you. Your next question's coming from Subbu Nambi from Guggenheim. Your line is live.

Speaker #4: Hey, guys. Thank you for taking my questions. What percentage of liquid biopsy orders today are Medicare versus commercial? And what's the realistic timeline to getting meaningful private payer rates?

Subbu Nambi: Hey, guys. Thank you for taking my questions. What percentage of liquid biopsy orders today are Medicare versus commercial? What's the realistic timeline to getting meaningful private payer rates? The reason I ask is.

Speaker #4: The reason I ask is, the rate—$3,289 fully loaded cost to deliver—how much would it, is it accurate to gross margins from day one, or is that a scale threshold you need to hit first?

Abhishek Jain: Mm-hmm.

Subbu Nambi: The rate $3,289 fully loaded cost to deliver. Is it accretive to gross margins from day one, or is there a scale threshold you need to hit first? I have the same question for RaDaR ST as well, the impact on gross margin from day one to when it ramps.

Speaker #4: And I have the same question for Radar ST as well. The impact on gross margin from day one to when it ramps.

Speaker #2: Yeah. Sure. Subhu, let me take this question for the liquid because we have not seen all the volumes since our soft launch, I would say, in the second half of the year.

Abhishek Jain: Yeah, sure. Subbu, let me take this question. For the liquid, because we have not, like, seen all the volumes, since our, like, soft launch, I would say, in the H2 last year, we are gonna basically push on all cylinders now to push the volume. I'll use cancer tissue as a proxy to provide you that payer mix. We basically have between the Medicaid and the Kindle, the direct Kindle, about 40% that we will basically get paid, and then about 10 points of Medicaid managed and the other 15 commercial payers. To your point, what we believe that we'll start to get paid on the 40% that has just onboarded both with Kindle and Medicare. On the commercial, this is a process, right?

Speaker #2: Last year, we are going to basically push on our cylinders now to push the volume. So I'll use PAN tracer tissue as a proxy to provide you that fair mix.

Speaker #2: So we basically have between the Medicare and the client list, the direct client list, about 40% that you will basically get paid. And then about 10 points of Medicare Advantage and the other 50 is commercial pairs.

Speaker #2: And to your point, what we believe that we will start to get paid on the 40% that I first talked about by the client bill and the Medicare and on the commercial, this is a process, right?

Speaker #2: As you know, what we have seen, how this process plays out, there will be a time, which—it will take some time as we start to get the coverage and the policy.

Abhishek Jain: As you know, what we have seen is how this process plays out. There will be a time which it will take some time as we start to get the coverage and the policy. My sense is that given the fact that we already have contracts with, like, 300 of these payers, that will definitely give us, like a seat on the table, and we'll be able to push through this one relatively faster, but this will take some time.

Speaker #2: My sense is that given the fact that we already have contracts with like 300 of these pairs, that will definitely give us a seat on the table and we'll be able to push through this one relatively faster but this will take some time.

Speaker #4: And coming to the radar, the mix is slightly different. I would say that's where Medicare is about 20 to 25 percent. And then you have Medicare Advantage will be Advantage, which will be 10 to 15 percent.

Subbu Nambi: Just looking for.

Abhishek Jain: Now, coming to the RaDaR.

Subbu Nambi: Mm-hmm. Mm-hmm.

Abhishek Jain: Coming to the RaDaR, the mix is slightly different. I would say that where Medicare is about 20% to 25%, and then you have Medicare Advantage, which will be 10% to 15%, and the rest will be commercial, and the Medicaid, little bit of the tail there. That's where this plays out. The overall payment rate for RaDaR, as in any other competitor that has seen this particular space, we are going to be starting to get paid on the Medicare, and then we'll have to start to build the coverage for the commercial payers.

Speaker #4: And the rest would be commercial and the Medicaid—a little bit of a tail there. So that's where this plays out. So the overall payment rate for Radar has, again, any other competitor that has seen this particular space, we are going to be starting to get paid on the Medicare, and then we'll have to start to build the coverage for the commercial payers.

Speaker #4: Got it. Thank you so much for that, Abhishek. And Abhishek, just to put all the numbers together, the low contracts that you guys had, the rationalized volumes, were they largely pathline volumes or this has got nothing to do with pathline volumes?

Subbu Nambi: Got it. Thank you so much for that, Abhishek. Abhishek, just to put all the numbers together, the low contracts that you guys had, the rationalized volumes, were they largely Pathline volumes, or this has got nothing to do with Pathline volumes, these were just other contracts?

Speaker #4: These were just other contracts?

Speaker #2: No, not pathline volumes, Subhu, because what I've called out that of our overall volumes in 2025, roughly 1.35 million we basically said that this high-volume, low-value contract was about 3 to 4 percent of the overall volumes.

Abhishek Jain: No, not Pathline volumes, Subbu, because what I've called out that, of our overall volumes in 2025, roughly 1.35 million, we basically said that this high volume, low value contract was about 3% to 4% of the overall volumes. Pathline is much more smaller, right, from that standpoint. This was a different contract.

Speaker #2: Pathline is much smaller, right, from that standpoint. So I would say this was a different contract.

Speaker #4: Perfect. Thank you so much, guys.

Subbu Nambi: Perfect. Thank you so much, guys.

Speaker #1: Thank you. Your next question is coming from Dan Brennan from TD Cowan. Your line is live.

Matthew: Thank you. Your next question's coming from Dan Brennan from TD Cowen. Your line is live.

Operator: Thank you. Your next question's coming from Dan Brennan from TD Cowen. Your line is live.

Speaker #5: Thanks, thanks for the questions. Maybe first one, just on the guide, could you just speak to a little bit for Q2 and for the year, just I think for the year you kind of spoke to it, but just NGS, ex-NGS, kind of what are we expecting for Q2?

Dan Brennan: Thanks, thanks for the questions. Maybe first one just on the guide. Could you just speak to a little bit for Q2 and for the year? Just I think for the year you kinda spoke to it, but just NGS, ex-NGS, kinda what are we expecting for Q2, and how does it look for the full year?

Speaker #5: And how does it look for the full year?

Speaker #2: Yeah. So what we are guiding for the full year is 800 million at the midpoint. And for Q2, the revenue growth is going to be 9% year over year as compared to the 8 to 9 percent that we had guided the last time.

Abhishek Jain: Yeah. What we are guiding for the full year is $800 million for the midpoint. For Q2, the revenue growth is going to be 9% year-over-year as compared to the 8% to 9% that we had guided the last time. We're basically adding more dollars in our Q2 because of the MolDX approval for liquid. That's the reason the guide goes up for Q2. For NGS, what we have basically called out, excluding liquid, we are going to be in line with what we have been in 2025, which is about 22%. That's the part in the NGS.

Speaker #2: We're basically adding more dollars in our Q2 because of the moldy eggs approval for liquid and that's the reason the guide goes up for the second quarter.

Speaker #2: For NGS, what we have basically called out, excluding liquid, we are going to be in line with what we have been in 2025, which is about 22%.

Speaker #2: So that's the part in the NGS. Now, if I were to step back and what Tony was saying, that this is a proven guide, this basically gives us a high degree of confidence to be able to kind of hit the midpoint of the guide.

Abhishek Jain: Now, if I were to step back and what Tony was saying, that this is a prudent guide, this basically gives us a high degree of confidence to be able to kind of hit the midpoint of the guide. At the same time, we believe that we should be able to come in better as compared to the mid-single-digit millions from the liquid. We'll be disappointed internally if we don't actually do better there. There are some upsides there. As well as I would say on the NGS, that we have been growing at 25%, 26%, and our guidance basically 22%, 23%. If we're able to kind of see the similar kind of growth on the NGS, that could be another upside.

Speaker #2: But at the same time, we believe that we should be able to come in better as compared to the mid-single-digit millions on the liquid will be disappointed internally if you don't actually do better there.

Speaker #2: So there are some upsides there. As well as, I would say, on the NGS, that we have been growing at 25 to 26 percent. And our guide is basically 20 to 23 percent.

Speaker #2: If you're able to kind of see the similar kind of growth on the NGS, then that could be another upside. So again, my takeaway on this one is that, from the guide midpoint standpoint, this is prudent, but it gives us the opportunity to be able to kind of come in ahead.

Abhishek Jain: Again, my takeaway on this one is that from the guide midpoint standpoint, this is prudent, but it gives us the opportunity to be able to kind of come in ahead if what we are anticipating internally were to go in our way.

Speaker #2: If what we are anticipating internally were to go in our way.

Speaker #1: Got it. So Q2, NGS should be 22, just like it is for the full year. Okay.

Operator: Got it. Q2 NGS should be 22, just like it is for the full year. Okay.

Dan Brennan: Got it. Q2 NGS should be 22, just like it is for the full year. Okay.

Speaker #2: I would be yeah, that's the guide. Yeah.

Dan Brennan: I would basically-

Abhishek Jain: I would basically-

Dan Brennan: You called out.

Abhishek Jain: Yeah, that's the guide.

Speaker #1: Okay. You called out in the prepared remarks about Epic Aura and the upside that other players maybe have seen or I forget how you termed it, experience.

Abhishek Jain: Oh.

Abhishek Jain: Yeah.

Dan Brennan: Okay. You called out in the prepared remarks about Epic Aura and the upside that other players maybe have seen, or I forget how you termed experience, the volume uplift.

Speaker #1: The volume uplift—just remind us where you are, what you're seeing so far, what's baked in, and what would get you to see that kind of uplift?

Dan Brennan: Mm-hmm.

Warren Stone: Mm-hmm.

Dan Brennan: Like, just remind us where you are, what are you seeing so far, what's baked in, and what would get you to see that kind of uplift? Like, what needs to happen?

Warren Stone: Like, just remind us where you are, what are you seeing so far, what's baked in, and what would get you to see that kind of uplift? Like, what needs to happen?

Speaker #1: What needs to happen?

Speaker #2: And Dan, thank you. We launched our we went live with our first customer earlier this month. So and the beauty of Epic Aura allows for a significantly faster implementation with customers.

Warren Stone: Dan, thank you. We went live with our first customer earlier this month. The beauty of Epic Aura, it allows for a significantly faster implementation with customers. We are targeting the Epic Aura implementations for therapy selection and MRD. We've got a robust pipeline of accounts that we're looking to activate with Epic Aura in Q2 all the way through the year. Certainly expecting to see that uptick as the year progresses. This is one of the key levers in terms of sustaining this high NGS growth rate that we've been talking about, and also will help to drive demand for RaDaR ST as well because the certified workflow that it will bring.

Speaker #2: So we are targeting the Epic Aura implementations for therapy selection and MRD. And we've got a robust pipeline of accounts that we're looking to activate with Epic Aura in quarter two all the way through the year.

Speaker #2: So certainly hoping to—expecting to—see that uptick as the year progresses. And this is one of the key levers in terms of sustaining this high NGS growth rate that we've been talking about, and also will help to drive demand for Radar SD as well, because of the simplified workflow that it'll bring.

Speaker #1: Got it. So some of the benefit is baked into the guide. It's not like there's potentially upside if you're successful with these account activations.

Dan Brennan: Got it. Some of the benefit is baked into the guide. It's not like there's potentially upside if you're successful with these account activations. Is that the right way to think about it?

Speaker #1: Is that the right way to think about it?

Speaker #2: I would say that if we're able to accelerate the implementations based on what we've put in the guide, there's upside there as well. Also, if the pull-through is as significant as what was articulated in these independent studies that were done, I think there's upside there as well.

Warren Stone: I would say that, if we're able to accelerate the implementations based on what we've put in the guide, there's upside there as well. If the pull-through is as significant as what was articulated in these independent studies that were done, I think there's upside there as well. We didn't assume that we would see that radical uplift, but there certainly are studies that point to that.

Speaker #2: We didn't assume that we would see that radical uplift, but there certainly are studies that point to that.

Speaker #1: Great. Thank you very much.

Dan Brennan: Great. Thank you very much.

Speaker #3: Thanks, Dan.

Tony Zook: Thanks, Dan.

Speaker #1: Thank you. Your next question is coming from Michael Reisgen from Bank of America. Your line is live.

Matthew: Thank you. Your next question is coming from Michael Ryskin from Bank of America. Your line is live.

Operator: Thank you. Your next question is coming from Michael Ryskin from Bank of America. Your line is live.

Speaker #6: Great. Thanks. A couple of quick ones. One is maybe as part of your answer to Dan just now, some of your comments on growth expectations through the year, both of NGS.

Michael Ryskin: Great. Thanks. couple quick ones. One is maybe as part of your answer to Dan just now, you know, some of your comments on growth expectations through the year, both of NGS, and non-NGS. What's the implicit contribution from some of the sales force expansion? I just maybe wondering if you could, you know, comment on the sales force addition, more broadly. You know, is that playing a role in the second half? Is that more of a 2027 benefit? Just how to think about that.

Speaker #6: And non-NGS, sort of what's the implicit contribution from some of the Salesforce expansion and just maybe wondering if you could comment on the Salesforce addition more broadly, if that playing a role in the second half, is that more of a 27 benefit, just how to think about that?

Speaker #2: Well, I think about the Salesforce as being actually quite productive for us, Michael. I think if you look at the size of our Salesforce and the size of our spend, we're probably relatively under-indexed versus many of our competitors.

Tony Zook: Well, I think about the sales force as being actually quite productive for us, Michael. I think if you look at the size of our sales force and the size of our spend, we're probably relatively under indexed versus many of our competitors. We got a, you know, sales and marketing ratio that's probably somewhere around 13%. If we look to just the oncology, the OSS team, you know, being in the fifties, that is a relatively low number, but yet they have proven to be quite productive, right? The share gains that you have seen with the NGS portfolio is driven in large part by that increased penetration into the community oncology space. We do see the sales force as one of the levers for us to continue to drive growth.

Speaker #2: We got a sales and marketing ratio that's probably somewhere around 13%. And if we look to just the oncology the OSS team, being in the 50s, that is a relatively low number, but yet they have proven to be quite productive, right?

Speaker #2: So the share gains that you have seen with the NGS portfolios proven in large part by that increased penetration into the community oncology space.

Speaker #2: And so, we do see the Salesforce as one of the levers for us to continue to drive growth. We also see it as an opportunity for us.

Tony Zook: We also see it as an opportunity for us. You take a product like RaDaR ST, and you see the relatively low market penetration rates, you know, we think we can contribute there. We do see the sales force as an ever-increasing opportunity for us to continue to drive growth. We will be selective in how we continue to expand and grow that side of the business because we think it is a large revenue driver opportunity for us. What we always have to balance, Michael, is not overly disrupting customer relationships that are established as well. We tend to take a, kind of a, very thoughtful process as to when we add them and how we add them, but they are clearly a growth driver for us.

Speaker #2: You take a product like Radar ST, and you see the relatively low market penetration rates we think we can contribute there. And so we do see the Salesforce as an ever-increasing opportunity for us to continue to drive growth.

Speaker #2: And we will be selective in how we continue to expand and grow that side of the business because we think it is a large revenue driver opportunity for us.

Speaker #2: What we always have to balance, Michael, is not overly disrupting the customer relationships that are established as well. So we tend to take a kind of a very thoughtful process is that when we add them and how we add them, but they are clearly a growth driver for us.

Speaker #2: And I don't think we'd be where we are today with the 26% growth had it not been for that investment that was made a year ago.

Tony Zook: I don't think we'd be where we are today with the 26% growth had it not been for that investment that was made a year ago.

Speaker #6: Okay. All right. And for my follow-up, I just kind of want to make sure I'm doing the math right. We're kind of calculating direct path line contribution continues to step down and kind of step down a little bit more this quarter.

Michael Ryskin: Okay. All right. For my follow-up, I just kinda wanna make sure I'm doing the math right. You know, we're kinda calculating, like, direct Pathline contribution. It, you know, continues to step down and kinda step down a little bit more this quarter. I heard what you called out on the call in terms of, you know, the benefit in the Northeast and the more broad, you know, uplift for the portfolio. Just anything specific to call out there? I mean, do we expect that to continue, or is that the weather impact in the quarter? If I'm just sort of taking the, you know, Pathline and ESP Pathline volumes, if I'm doing the math right.

Speaker #6: I heard what you called out on the call in terms of the benefit in the Northeast and the more broad uplift to the portfolio.

Speaker #6: But just anything specific to call out there? I mean, do we expect that to continue, or is that the weather impact in the quarter?

Speaker #6: If I'm just sort of taking the path line ASP, path line volumes, doing the math right?

Speaker #2: Well, listen, I'll start us off and then Warren Ravenshack can jump in. Again, it shouldn't be a surprise that there might have been a slight step down in the volumes associated with path line because we were exiting some of that non-oncology business.

Tony Zook: Well, listen, I'll start us off, then Warren, obviously, I can jump in. Again, it shouldn't be a surprise that there might have been a slight step down in the volumes associated with Pathline because, you know, we were exiting some of that non-oncology business, so that certainly had an effect. Then, of course, we're doing a lot of work here on load balancing. We want to make sure that the tests go. They don't always have to go through Pathline. They can be ordered and be run down through Fort Myers or AV. So load balancing comes into play. That's why honestly, I don't put a lot of stock into what is directly attributed just to Pathline.

Speaker #2: And so that certainly had an effect. And then, of course, we're doing a lot of work here on load balancing. We want to make sure that the tests go not necessarily they don't always have to go through path line.

Speaker #2: They can be ordered and be run down through Fort Myers or AV. And so load balancing comes into play. That's why honestly, I don't put a lot of stock into what is directly attributed just to path line.

Speaker #2: It certainly delivered what we expected in its range of revenue, but the growth driver that we see in the Northeast—that is the catalyst.

Tony Zook: It certainly delivered what we expected in its range of revenue, but the growth driver that we see in the Northeast, that is the catalyst. Warren Stone, you can maybe add a little bit more comment on that.

Speaker #2: And so Warren, you can maybe add a little bit more comment on that.

Speaker #3: Well, I need the third aspect that I would say that you didn't touch on is the Northeast was probably the area that was most affected by weather in the first quarter.

Warren Stone: Well, the third aspect I would say that you didn't touch on, that the Northeast was probably the area that was most affected by weather in Q1. That's the third factor. You've got weather. There's non-oncology business that we have no interest in entertaining, so we're stepping out of that business. The third dynamic is we're leveraging our lab network to provide the best possible turnaround time, but also drive scale where possible. Some of the testing that was historically done in the Ramsey lab or Pathline lab has moved to other parts of our network. Overall, I'd say we're very pleased with the development we've seen so far. That one and a half times market growth in the Northeast is really encouraging, particularly based on some of the trends we're seeing historically.

Speaker #3: So that's the third factor. So you've got weather. There's non-oncology business that we have no interest in entertaining. So we're stepping out of that business.

Speaker #3: And then the third dynamic is we're leveraging our lab network to provide the best possible turnaround time, but also drive scale where possible. So some of the testing that was historically done and the Ramsey Lab, the path line lab, has moved to other parts of our network.

Speaker #3: Overall, I'd say we're very pleased with the development we're seeing so far. That one and a half times market growth in the Northeast is really encouraging, particularly based on some of the trends we're seeing historically.

Speaker #6: All right. Thank you. Thank you.

Speaker #4: Thank you.

Michael Ryskin: All right. Thank you. Thank you.

Tony Zook: Thank you.

Speaker #1: Thank you. Our next question comes from Mike Matson from Needham. Your line is live.

Matthew: Thank you. Our next question comes from Mike Matson from Needham. Your line is live.

Operator: Thank you. Our next question comes from Mike Matson from Needham. Your line is live.

Speaker #5: Yeah. Thanks. So I thought I heard you guys say that in the NGS business, there are some price benefits. So obviously, I mean, I know that the NGS is growing as a part of the overall mix and driving price, but is there some positive pricing mix happening within that NGS business?

Mike Matson: Yeah, thanks. I thought I heard you guys say that within the NGS business, there's some price benefit. Obviously, I mean, I know that the NGS is growing as a part of the overall mix and driving price, but, like, is there some positive pricing mix happening within that NGS business, and what's driving it?

Speaker #5: And what's driving it?

Speaker #2: No, absolutely. So on the NGS business, what we have called out that this business grew 26%, 16% of that was driven by volume and the other 10% came from the increase in the AUP.

Abhishek Jain: No, absolutely. On the NGS business, what we have called out that this business grew 26%, 16% of that was driven by volume, the other 10% came from the increase in the AUP. As we were discussing that AUP increase has been on account of some of the RCM initiatives that we have put in place. At the same time, we are seeing the increase in the CGP panel in the NGS business as we move from the single panel gene test. That is basically, again, moving towards the high-value testing, which is helping us drive the AUP high.

Speaker #2: And as we were discussing that AUP increase has been on account of some of the RCM initiatives that we have put in place. But at the same time, we are seeing the increase in the CGP panel in the NGS business as we move from the single panel gene test.

Speaker #2: So that is basically kind of again moving towards the high-value testing, which is helping us drive the AUPs higher.

Speaker #5: Okay. And then the 20 billion MRD market, when you get these additional two indications covered, and you're at four, and I think you said that would double the available market to you.

Mike Matson: Okay. The $20 billion MRD market, when you get these additional two indications covered and you're at four, and I think you said that would double the available market to you. What portion of that $20 billion will you be covering?

Speaker #5: So what portion of that 20 billion will you be covering?

Warren Stone: Based on, again, this is obviously somewhat subjective, but based on the analysis that we've done, we'll be north of 45% of the market across those four indications.

Speaker #3: Based on, again, this is obviously somewhat subjective, but based on the analysis that we've done, we'll be north of 45% of the market across those four indications.

Speaker #5: Okay. Great. Thank you.

Mike Matson: Okay, great. Thank you.

Speaker #4: Thank you.

Tony Zook: Thank you.

Speaker #1: Thank you. That concludes our Q&A session. I'll now hand the conference back to Tony Zook for closing remarks. Please go ahead.

Matthew: Thank you. That concludes our Q&A session. I'll now hand the conference back to Tony Zook for closing remarks. Please go ahead.

Operator: Thank you. That concludes our Q&A session. I'll now hand the conference back to Tony Zook for closing remarks. Please go ahead.

Speaker #2: Well, first off, I’d just like to thank everybody for joining us on the call. I’d also like to thank our roughly 2,400 teammates at NEO for their continued hard work and unwavering commitment to our mission.

Tony Zook: Well, first off, I'd just like to thank everybody for joining us on the call. I'd also like to thank our roughly 2,400 teammates at Neo for their continued hard work and unwavering commitment to our mission. With meaningful additions to our therapy selection and MRD test offerings during Q1, I'm very excited for the year ahead as well as 2027 and beyond, as these high-value tests represent a growing portion of our clinical business. I look forward to our next quarterly update in July when we report our Q2 results. Thank you again. Have a great day.

Speaker #2: With meaningful additions to our therapy selection and MRT test offerings during the first quarter, I'm very excited for the year ahead as well as 2027 and beyond, as these high-value tests represent a growing portion of our clinical business.

Speaker #2: I look forward to our next quarterly update in July, when we'll report our second quarter results. Thank you again, and have a great day.

Matthew: Thank you. Everyone, this concludes today's event. You may disconnect at this time, and have a wonderful day. Thank you for your participation.

Operator: Thank you. Everyone, this concludes today's event. You may disconnect at this time, and have a wonderful day. Thank you for your participation.

Q1 2026 NeoGenomics Inc Earnings Call

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