NeoGenomics — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue increased 11% year-over-year to $209 million for the three months ended September 30, 2026.
• Clinical revenue grew 13% year-over-year to $195 million, driven by a 29% increase in Next-Generation Sequencing (NGS) revenue.
• Consolidated gross profit increased 20% year-over-year to $97 million; GAAP gross margin expanded 340 basis points to 46%.
• Adjusted gross margin increased 310 basis points to 49%, delivering adjusted EBITDA of $19 million, a 53% increase year-over-year.
• Net loss narrowed 72% year-over-year to $8 million, compared to a $27 million loss in the same period in 2025.
• Adjusted net income was $11 million, up from $4 million in the third quarter of 2025.
• Operating expenses decreased 3% year-over-year to $105 million.
• Cash and cash equivalents totaled $139 million at quarter end.
• Average revenue per clinical test increased 11% year-over-year to $530.

Guidance and Future Outlook:

• The company raised full-year 2026 revenue guidance to a range of $807 million to $809 million (previously $802 million to $806 million), representing an 11% year-over-year increase from 2025 actuals of $727 million.
• Full-year 2026 net loss guidance was revised to a range of $(32) million to $(30) million (previously $(42) million to $(34) million), a 70-72% improvement year-over-year.
• Full-year 2026 adjusted EBITDA guidance was raised to approximately $60 million (previously $56 million to $58 million), representing an approximately 38% year-over-year increase.

Business Segments and Product Lines:

• NGS test volume grew 17% year-over-year.
• Medicare coverage for RaDaR ST was expanded to include immunotherapy treatment response monitoring in late-stage solid tumors, marking the third Medicare-covered indication for the test.
• Agreements with multiple commercial payers were expanded to bring NeoGenomics in-network and broaden access and reimbursement for new tests.
• Digital transformation initiatives continued, including scaling NovaSeq X, IT systems, and the revenue cycle management platform.

Market and Competitive Landscape:

• The company highlighted a strategic shift toward higher-value, high-margin testing modalities.
• Management emphasized the strength of its broad-based testing solutions portfolio and plans to invest in commercial teams and community channel strength.

Risks and Challenges:

• Forward-looking statements identify risks including the ability to execute financial and operational initiatives, achieve guidance results, and realize efficiencies from operational excellence.
• Potential challenges include compensation, benefits, and supply cost inflation; difficulties in entering new markets or increasing market share; and the need to develop, validate, and commercialize new tests.
• Risks include evolving regulatory requirements for laboratory developed tests, tariffs and trade policy uncertainty, reimbursement changes by payers, and compliance costs with healthcare laws.
• Risks also include potential dilution from convertible senior notes, outcomes of pending legal proceedings, and the ability to integrate acquired businesses.

Management Commentary and Tone:

• CEO Tony Zook stated that third-quarter results reinforce the company's strategy and team execution, citing clinical revenue growth of 13% and NGS revenue growth of 29% as evidence of portfolio strength.
• Management expressed confidence in further opportunities to invest in commercial teams and product pipelines while reducing business complexity through operational excellence initiatives designed to deliver accelerating growth and disciplined margin expansion.

Other Key Points:

• Leadership succession was announced: Warren Stone, currently President and COO, will become CEO and Board member effective January 4, 2027, while Tony Zook will transition to Executive Chairman.
• The company reported a gain on extinguishment of debt of $11.2 million for the nine months ended September 30, 2026.
• Repurchases of common stock totaled $25 million for the nine months ended September 30, 2026.
• Convertible senior notes, net, increased to $374.7 million at September 30, 2026, from $341.9 million at December 31, 2025.
• Accounts receivable, net, increased to $213.4 million at September 30, 2026, from $159.2 million at December 31, 2025.