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MG

MYRIAD GENETICS INC (MYGN)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $195.9M, down 3% year-over-year, with gross margin 68.5% GAAP (69.0% adjusted); Adjusted EPS was $(0.03). Management lowered FY25 guidance to $807–$823M revenue and $(0.02)–$0.02 adjusted EPS, citing GeneSight coverage changes and slower ramp in unaffected hereditary cancer testing .
  • Versus consensus, Q1 revenue missed ($200.5M consensus vs $195.9M actual) while adjusted EPS beat (consensus $(0.054) vs actual $(0.03)); Q4 2024 was a slight revenue beat and EPS in-line*.
  • Segment trends: Prenatal +11% YoY to $49.3M; Pharmacogenomics (GeneSight) −20% YoY to $31.0M; Oncology revenue $77.7M, with mixed dynamics in hereditary cancer and Prolaris .
  • Liquidity remains adequate: cash and equivalents ~$92M and $42M availability under the ABL; operating cash flow used was $16.3M in Q1. Management expects modest sequential revenue increases through FY25 while reprioritizing spend to preserve strategic investments .
  • Stock reaction catalysts: narrative simplification and pipeline execution (FirstGene early-access launch, Precise MRD data at AACR/ASCO, AI-enabled Prolaris by year-end) vs. reimbursement headwinds and EMR integration ramp in Women’s Health .

What Went Well and What Went Wrong

What Went Well

  • Prenatal strength: revenue +11% YoY with traction from Prequel at 8 weeks gestational age and broader account penetration . “We saw healthy demand across both our carrier screen and NIPT lines and continued traction from our mid-fourth quarter launch of Prequel at 8 weeks gestational age” .
  • Oncology myRisk volume growth: affected population volume +11% YoY, maintaining category leadership . “myRisk remains the gold standard in the market for hereditary cancer testing” .
  • Pipeline momentum: Precise MRD presented positive clinical data at AACR; multiple oncology/MRD presentations accepted at ASCO; FirstGene multi-modal prenatal screen launched via early-access CONNECTOR study .

What Went Wrong

  • GeneSight reimbursement headwind: UNH policy change drove a ~$10M revenue headwind in Q1; management reduced commercial resources, contributing to lower volumes than expected .
  • Unaffected hereditary cancer ramp: stable volumes but revenue declined 4% YoY; EMR workflow integration (family history capture, virtual kit logistics, counseling pathways) is taking multiple quarters to scale .
  • Guidance reduction: FY25 revenue midpoint lowered by $35M with adjusted EPS range reset, reflecting pharmacogenomics and Women’s Health hereditary cancer softness .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$213.3 $210.6 $195.9
GAAP Gross Margin %70.2% 71.7% 68.5%
Adjusted Gross Margin %70.6% 72.0% 69.0%
GAAP Operating Income (Loss) ($M)$(20.0) $(39.0) $(29.0)
Adjusted Operating Income (Loss) ($M)$9.5 $5.6 $(5.5)
GAAP Net Income (Loss) ($M)$(22.1) $(42.5) $(0.1) (incl. $29.3M tax benefit)
Adjusted EPS ($)$0.06 $0.03 (diluted) $(0.03)
Adjusted EBITDA ($M)$14.1 $10.6 $(0.1)
Cash from Operations ($M)$0.7 $6.6 $(16.3)

Note: Earnings call remarked “59% gross margin” for Q1; press release and GAAP statements reflect 68.5% GAAP and 69.0% adjusted. We anchor on 8-K figures .

Versus Estimates

MetricQ4 2024 ConsensusQ4 2024 ActualQ1 2025 ConsensusQ1 2025 Actual
Revenue ($USD Millions)$210.35*$210.6 $200.51*$195.9
Primary EPS ($)$0.030*$0.03 $(0.054)*$(0.03)

Values marked with * retrieved from S&P Global.

Segment Revenue ($USD Millions)

Product CategoryQ3 2024Q4 2024Q1 2025
Hereditary Cancer$90.5 $94.3 $86.3
Tumor Profiling$31.6 $30.8 $29.3
Prenatal$43.5 $44.9 $49.3
Pharmacogenomics (GeneSight)$47.7 $40.6 $31.0
Total$213.3 $210.6 $195.9

KPIs (Volumes; thousands)

Product Volumes (000s)Q3 2024Q4 2024Q1 2025
Hereditary Cancer74 75 73
Tumor Profiling13 12 12
Prenatal162 160 173
Pharmacogenomics127 127 127
Total376 374 385

Additional KPIs and Commentary:

  • Average revenue per test down ~4% YoY in Q1 (absence of ~$7M prior-period benefit and UNH GeneSight impact) .
  • Adjusted free cash flow in Q1 was $(18.7)M; capex $5.3M and software capitalization $3.0M .

Guidance Changes

MetricPeriodPrevious Guidance (Feb 24, 2025)Current Guidance (May 6, 2025)Change
Revenue ($M)FY 2025$840 – $860 $807 – $823 Lowered
Gross Margin % (GAAP)FY 202569.5% – 70.5% 68.5% – 69.5% Lowered
Adjusted Operating Expenses ($M)FY 2025$575 – $595 $555 – $565 Lowered
Adjusted EBITDA ($M)FY 2025$25 – $35 $19 – $27 Lowered
Adjusted EPS ($)FY 2025$0.07 – $0.11 (94M shares) $(0.02) – $0.02 (94M shares) Lowered

Management expects modest sequential revenue increases through FY25 and is “deliberately reducing discretionary spend” while protecting R&D and commercial investments .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
GeneSight reimbursement (UNH)UNH commercial coverage discontinued effective Jan 1, 2025; ~$40M TTM UNH revenue exposure ~$10M Q1 headwind; smaller Managed Medicaid impact starting March; volumes light due to reduced investment Negative; resource reallocation away from PGx
EMR integration & unaffected hereditary cancerPartnerships with Flatiron; jscreen; ramp uneven in Women’s Health Flat volumes; revenue −4% YoY; workflow additions needed (family history, virtual kit, counseling) with Epic integration; multi-quarter effort Near-term headwind; execution-driven improvement expected
Prenatal screeningThird-party strength; Prequel at eight weeks (SMFM award) Prenatal revenue +11% YoY; deeper penetration; FirstGene early-access study initiated Positive; portfolio expansion
Oncology strategy (myRisk, Prolaris, PATHOMIQ AI)PATHOMIQ AI partnership and NCCN alignment Oncology $77.7M; affected myRisk volumes +11% YoY; Prolaris −2% YoY; aim to launch AI-enabled test by YE25 Mixed; innovation pipeline supportive
MRD (Precise MRD)MD Anderson alliance; patents; multiple studies Positive AACR readout; 7 ASCO acceptances; target first assay in 1H26 Positive; clinical momentum
Liquidity/ABL covenantLiquidity strengthened in Q3/Q4; streamlined working capital $92M cash and $42M ABL availability; above fixed charge coverage ratio Stable

Management Commentary

  • “We had a challenging first quarter of 2025 with strength in our prenatal and oncology MyRisk tests offset by softness in GeneSight and unaffected hereditary cancer tests… we are lowering our 2025 financial guidance. We are taking immediate steps to reduce overall expenditures while prioritizing investment in new product development and programs intended to drive revenue growth.” — Sam Raha, President & CEO .
  • “We lowered our annual revenue by $35 million from the prior midpoint and reduced OpEx by $25 million… while prioritizing investments and resources on driving 2025 revenue and high-value new product development, including PRECISE MRD and AI-enabled Prolaris.” — Sam Raha .
  • “We are expecting modest sequential increases each quarter… reallocation of commercial resources away from GeneSight… slower-than-anticipated ramp impacting unaffected hereditary cancer volumes.” — Scott Leffler, CFO .
  • “Our strategy refresh will take several months… resolute on oncology as the cornerstone, and execution excellence will be a focus.” — Sam Raha .

Q&A Highlights

  • Narrative simplification: Investors pressed for a simpler story and key metrics; management outlined a framework (strategy, team, execution) and milestones (meeting guidance, Prolaris stability, FirstGene by July, AI Prolaris by YE25, MRD in 1H26) .
  • GeneSight impact bridge: ~$10M Q1 headwind from UNH commercial policy; additional smaller managed Medicaid impact beginning March; FY guide incorporates full effect .
  • EMR integration detail: Workflow gaps (family history capture, virtual kit shipping, counseling) require Epic feature build and account-by-account activation; multi-quarter timeline .
  • RCM/no-pay progress: No-pay rate improved from ~46% entering 2024 to ~43–44% exiting 2024; sizable opportunity remains in 2025 .
  • Liquidity and ABL covenant: Above fixed charge coverage ratio; day-to-day liquidity needs modest post restructuring; ~$92M cash and $42M revolver availability .
  • Prolaris/NCCN guideline confusion: Customer education largely addressed; AI partnership reaffirmed prostate commitment; target steady volumes near term .

Estimates Context

  • Q1 2025: Revenue missed ($195.9M actual vs $200.5M consensus), but adjusted EPS beat ($(0.03) actual vs $(0.054) consensus)* .
  • Q4 2024: Revenue slightly beat ($210.6M actual vs $210.35M consensus), EPS in-line (both ~$$0.03)* .

Values retrieved from S&P Global.

Where estimates may need to adjust:

  • FY25 revenue/EPS downshift reflects sustained UNH PGx headwinds and slower Women’s Health hereditary cancer ramp; consensus likely converges toward $807–$823M revenue and $(0.02)–$0.02 EPS ranges provided .

Key Takeaways for Investors

  • Near-term headwinds are chiefly reimbursement-driven (UNH GeneSight) and executional (EMR workflow in Women’s Health). Expect modest sequential revenue upticks but a lower FY25 earnings power trajectory per updated ranges .
  • Prenatal is the growth ballast (Prequel 8-week capability; FirstGene early-access program); this segment can offset PGx softness and support mix-driven margins over time .
  • Oncology remains strategic: AI-enabled Prolaris and MRD advances are meaningful optionality; watch execution against stated timelines (YE25 AI Prolaris; 1H26 MRD) as potential re-rating catalysts .
  • Gross margin resilience: Despite revenue pressure, GAAP GM held at 68.5% and adjusted GM at 69.0% due to lab efficiencies; monitor for product mix/pricing volatility (management expects quarterly fluctuation) .
  • Liquidity adequate but execution-sensitive: $92M cash and $42M ABL availability; focus on adjusted operating cash flow trajectory and covenant buffer through 2025 .
  • Trading setup: As estimate revisions settle and narrative simplifies, near-term stock moves likely tied to payer developments (any GeneSight coverage wins), EMR workflow milestones, and pipeline dataflow (ASCO, FirstGene) .
  • Risk lens: Payer coverage, EMR adoption cadence, and pipeline timing are the critical variables; management’s reprioritization of spend seeks to protect R&D/commercial capacity while absorbing revenue shocks .

Appendix: Additional Context from Q1/Q2 Press Releases and Prior Quarters

  • MRD AACR late-breaking oral presentation: Precise MRD positivity associated with earlier initiation of systemic therapy; negatives maintained on MDT ~54 months vs ~27 months for positives .
  • FirstGene early-access: Four-in-one prenatal assay (fetal aneuploidy, fetal recessive disease, maternal carrier screening, RhD compatibility) without paternal sample requirement; sensitivity >98.6%, specificity 99.6% (analytical validation) .
  • Prequel 8-week gestation: SMFM award; average fetal fraction 12.5%; no-call rate <0.5% between 8–10 weeks .