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IB

INTERPACE BIOSCIENCES, INC. (IDXG)·Q2 2025 Earnings Summary

Executive Summary

  • Net Revenue was $9.2M, down 23% year-over-year due to PancraGEN reimbursement loss; gross margin was 57% reported (65% excluding one-time PancraGEN wind-down impacts), and Adjusted EBITDA was $0.4M .
  • Thyroid franchise delivered record results: Thyroid revenue $8.7M (+25% YoY) and test volume +16% YoY; cash collections were $10.8M (near prior-year levels) .
  • Management highlighted preliminary July 2025 revenue of $3.3M (+54% YoY), indicating momentum into Q3; operating loss of $0.5M included ~$1.2M one-time charges related to PancraGEN wind-down .
  • FY 2025 revenue guidance of approximately $38M, initiated in Q1, appears maintained with no formal update in Q2; there were no available S&P Global consensus estimates for EPS or revenue to benchmark beats/misses (values unavailable via S&P Global)* .

What Went Well and What Went Wrong

What Went Well

  • Record thyroid performance: “Q2 Thyroid test volume up 16% year-over-year to record levels” and “Thyroid revenue of $8.7M; up 25% year-over-year to record levels” .
  • Strong cash collections and operating discipline: “Q2 2025 cash collections totaled $10.8 million compared to $11.0 million in the prior year quarter,” while debt principal payments further strengthened the balance sheet .
  • Early Q3 momentum: “Preliminary revenue for July 2025 was $3.3 million, marking a substantial 54% increase compared to July 2024” .

What Went Wrong

  • PancraGEN reimbursement ended, forcing exit: CMS/Novitas finalized LCD ending coverage; Interpace ceased accepting specimens after May 2, 2025; Q2 included ~$1.2M one-time wind-down charges .
  • YoY revenue decline and margin compression: Net Revenue fell 23% YoY ($9.2M vs $12.0M), gross margin was 57% vs 65% YoY (65% ex one-time impact), and Adjusted EBITDA declined to $0.4M vs $2.8M .
  • Transition costs impacted profitability: Operating loss was $0.5M vs operating income of $2.6M in prior-year quarter; continuing ops shifted from +$2.5M to $(0.5)M .

Financial Results

Headline Financials vs Prior Periods

MetricQ3 2024Q1 2025Q2 2025
Net Revenue ($USD Millions)$12.295 $11.515 $9.232
Operating Income (Loss) ($USD Millions)$1.905 $1.829 $(0.468)
Gross Profit ($USD Millions)$7.506 $7.370 $5.276
Gross Profit %61% (approx) 64% 57% (65% ex one-time)
Adjusted EBITDA ($USD Millions)$2.076 $2.096 $0.365
Diluted EPS (Total) ($)$0.29 $0.06 $(0.14)
Diluted EPS (Cont. Ops) ($)$0.31 $0.06 $(0.12)

Year-over-Year (Q2 YoY)

MetricQ2 2024Q2 2025
Net Revenue ($USD Millions)$12.042 $9.232
Gross Profit %65% 57% (65% ex one-time)
Operating Income (Loss) ($USD Millions)$2.632 $(0.468)
Adjusted EBITDA ($USD Millions)$2.752 $0.365
Thyroid Revenue ($USD Millions)n/a$8.7
Thyroid Test Volume YoY (%)n/a+16%

Segment/KPI Highlights

MetricQ1 2025Q2 2025
Thyroid Revenue ($USD Millions)$8.0 $8.7
Thyroid Test Volume YoY (%)+16% +16%
Cash Collections ($USD Millions)$11.3 $10.8

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD Millions)FY 2025Approximately $38 No formal update disclosed in Q2; appears maintained Maintained
Profitability/MarginsFY 2025Not providedNot providedn/a
Other (OpEx, OI&E, Tax)FY 2025Not providedNot providedn/a

Earnings Call Themes & Trends

Note: An earnings call transcript for Q2 2025 was not available in our document set, so themes reflect press releases across quarters .

TopicPrevious Mentions (Q-2: Q3 2024)Previous Mentions (Q-1: Q1 2025)Current Period (Q2 2025)Trend
AI/Automation & Operational EfficiencyInvesting to lower operating cost per test; operating cost/test ~11% lower YoY “AI and automation digital strategy” investments; simultaneous margin improvements Continued investments in lab efficiency leveraging AI/automation Improving operational leverage
Reimbursement/RegulatoryPancraGEN LCD under review noted as risk Uncertainty around PancraGEN reimbursement CMS/Novitas LCD finalized; stopped accepting specimens after May 2, 2025 Negative resolved; business refocused
Revenue Growth & MixRecord revenue and volume; double-digit growth Net Revenue +13% YoY; thyroid revenue records Net Revenue down YoY on exit of PancraGEN; thyroid revenue +25% YoY Mix shifts to thyroid; headline revenue reset
Profitability & Cash FlowSustained profitability; Adjusted EBITDA $2.1M Income from continuing ops $1.8M; Adj. EBITDA $2.1M Operating loss due to one-time charges; Adj. EBITDA $0.4M; July revenue +54% YoY supportive Short-term dip; signs of rebound
Balance Sheet & DebtAdditional debt paydown; positioning for growth Additional principal payments improving balance sheet Further balance sheet strengthening with principal payments Deleveraging continues
Strategic FocusConsidering uplisting/Nasdaq and capital raise Reinforcing thyroid diagnostics foundation Transition to thyroid-only clinical diagnostics business Strategic narrowing of focus

Management Commentary

  • CFO: “Our second quarter results were impacted by the loss of reimbursement for our PancraGEN testing… reported loss includes one-time charges of $1.2 million associated with the wind-down of PancraGEN…” Also noted July preliminary revenue +54% YoY and investments in lab efficiency via AI/automation .
  • CEO: “Despite the loss of reimbursement for the Company’s PancraGEN test, Q2 2025 represented another quarter of year-over-year double digit Thyroid volume and revenue growth… excited about continued growth in revenue, profitability and cash flow as a thyroid only clinical diagnostics business” .
  • April release (transition specifics): “Specimens… will not be accepted… after May 2, 2025… we expect… ThyGeNEXT + ThyraMIRv2 will allow us to continue to remain profitable in 2025 and beyond” .

Q&A Highlights

  • No earnings call transcript was available for Q2 2025; therefore, specific analyst Q&A themes and management responses could not be extracted from a transcript [ListDocuments returned none].

Estimates Context

  • Wall Street consensus estimates via S&P Global were not available for Q2 2025 EPS or revenue for IDXG, preventing a formal beat/miss comparison*.
  • Actuals used: Q2 2025 Net Revenue $9.232M and diluted EPS (total) $(0.14), diluted EPS (continuing ops) $(0.12) .
  • Given the reset in revenue mix post-PancraGEN, we expect sell-side models (where maintained) to re-base near-term revenue and margin trajectories toward thyroid-only diagnostics, with upside optionality from Q3 momentum (July +54% YoY revenue) .

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • The thyroid franchise is performing robustly with record volume and revenue; the company has effectively pivoted to a thyroid-only diagnostics focus and sees continued growth .
  • Q2 headline revenue decline and profitability impact were largely driven by PancraGEN reimbursement loss and one-time wind-down costs; excluding these, gross margin would have been ~65%, comparable to prior-year .
  • Early Q3 datapoint (July +54% YoY revenue) is a positive near-term catalyst for sentiment and suggests a quick stabilization post-transition .
  • Balance sheet improvements via debt principal payments continue; cash collections remained strong, supporting operational investments and transition execution .
  • FY 2025 revenue guidance of approximately $38M remains the anchor (initiated Q1); with the business mix shift, updates to guidance could become a focal point in upcoming quarters .
  • Near-term, watch for margin normalization absent one-time charges and the cadence of cash collections; medium-term thesis hinges on sustained thyroid testing penetration, operational efficiency via AI/automation, and potential scientific/clinical validation tailwinds (e.g., ATA poster data) .
  • Regulatory overhang has resolved (PancraGEN exit); core execution now depends on commercial momentum in thyroid diagnostics and continued payer/process effectiveness .