NeoGenomics Inc. ((NEO)) has held its Q3 earnings call. Read on for the main highlights of the call.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
NeoGenomics Inc. recently held its earnings call, revealing a strong performance in its clinical segment, marked by significant volume and revenue growth. The call highlighted successful acquisitions and favorable legal outcomes, although challenges persist in the nonclinical revenue sector, particularly in the pharma segment, which are expected to continue into 2026.
Record Clinical Volumes and Revenue Growth
NeoGenomics reported an 18% increase in total clinical revenue compared to the previous year, driven by a 15% rise in test volumes and a 4% increase in average unit price (AUP). Notably, Next-Generation Sequencing (NGS) revenues surged by 24% over the prior year, now making up 33% of the total clinical revenue.
Successful Pathline Acquisition
The acquisition of Pathline is set to enhance NeoGenomics’ operations, particularly in the Northeast region, which is the third-largest cancer care market in the U.S. This acquisition is expected to improve turnaround times and contribute positively to profitability starting in 2026.
Favorable Court Ruling for RaDaR ST
A favorable court ruling has cleared the path for the full clinical launch of the RaDaR ST MRD assay. NeoGenomics plans a robust launch in the first quarter of 2026, which is anticipated to bolster the company’s clinical offerings.
PanTracer LBx Launch
NeoGenomics launched the PanTracer LBx, a noninvasive blood-based test, following insights gained from an evaluation assessment program. The company expects commercial availability and growth for this product in 2026.
Decline in Nonclinical Revenue
The earnings call revealed a 27% decline in nonclinical revenue compared to the previous year, primarily due to weaknesses in the pharma revenue segment.
Challenges with Pharma Revenue Growth
NeoGenomics anticipates continued softness in pharma revenue throughout the fourth quarter of 2025 and into 2026, attributing this to long sales cycles and current market conditions.
Forward-Looking Guidance
During the earnings call, NeoGenomics provided guidance for the remainder of 2025 and beyond. The company expects consolidated revenue to range between $720 million and $726 million, with adjusted EBITDA projected between $41 million and $44 million. Despite the positive clinical revenue growth, NeoGenomics forecasts a net loss between $116 million and $108 million. The favorable court ruling regarding the RaDaR ST MRD assay is expected to positively impact revenues in 2026.
In summary, NeoGenomics Inc.’s earnings call highlighted robust growth in the clinical segment, driven by increased test volumes and strategic acquisitions. While challenges remain in the nonclinical sector, particularly in pharma revenue, the company’s forward-looking guidance suggests optimism for continued growth and profitability improvements in the coming years.