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01/10 16:58
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call presents mixed signals: positive revenue growth, improved EBITDA loss, and strong gross margins, but concerns over churn and competitive pressures. The Q&A highlights effective implementation and partnerships, yet lacks clarity on sustainable margins. No share buyback program and a cautious revenue guidance contribute to a neutral outlook.
Revenue $17.8 million (up 13% year-over-year; up 15% on a constant currency basis). Growth attributed to new business from 2024 coming online and an increase in core genomic customers.
Adjusted EBITDA Loss $9.8 million (improved by 24% year-over-year). Improvement due to effective cost management and revenue growth.
Gross Profit $12.2 million (up 17% year-over-year). Growth driven by increased revenue and improved operational efficiencies.
Adjusted Gross Margin 75.7% (up 520 basis points year-over-year). Achieved through targeted platform improvements that reduced cloud compute and storage costs.
Operating Loss $16 million (compared to $18.8 million in the prior year). Improvement attributed to reduced operating expenses.
Total Cash Burn $11.7 million (compared to $19.5 million in the prior year). Improvement due to better cash management and operational efficiencies.
Core Genomic Customers 490 (up from 463 year-over-year). Growth driven by the addition of 33 new customers in Q1.
Net Dollar Retention 103% (driven primarily by growth in core genomic customers despite some churn in Latin America).
New Applications: Launched new applications such as MSK ACES and MSK Impact.
Liquid Biopsy Applications: MSK-ACCESS application is attracting material interest from biopharma partners.
U.S. Market Expansion: Revenue and analysis volume from U.S. core genomic customers grew over 30% year-over-year.
New Partnerships: Expanded partnerships with Henry Ford Hospital and Mayo Clinic for additional applications.
International Expansion: Signed new partnerships in Japan and Malaysia, expanding into critical new markets.
Customer Implementation: Implemented 33 new customers in Q1, up from an average of 23 per quarter last year.
Cost Management: Adjusted EBITDA loss improved by 24% year-over-year to $9.8 million.
Gross Margin Improvement: Achieved a record adjusted gross margin of 75.7%, up 520 basis points year-over-year.
Partnership Expansion: Expanded partnership with AstraZeneca to accelerate MSK-ACCES deployment globally.
Focus on Scalability: Continued emphasis on scalable cloud-based platform to support medical innovations.
Competitive Pressures: Biopharma continues to present some modest headwinds, impacting growth despite a strong start to the year.
Regulatory Issues: The company is monitoring developments on the tariff front, which could impact operations, although they believe the impact to be manageable.
Supply Chain Challenges: The company ships consumables globally from Switzerland, and while a 10% tariff on shipments to the U.S. would be manageable, it is still a concern.
Economic Factors: Exchange rates are expected to be volatile due to macro uncertainties, which may affect reported results.
Customer Churn: The company experienced some churn with smaller accounts that had not generated revenue over the past 12 months, although Q1 revenue churn remained low at approximately 4%.
Customer Growth: In Q1 2025, SOPHiA GENETICS added 28 new core genomic customers, bringing the total to 490. This is part of a strategy to expedite implementation times and expand across new accounts.
U.S. Market Focus: Revenue and analysis volume from U.S. core genomic customers grew over 30% year-over-year, indicating a strong focus on penetrating the U.S. market.
Partnership Expansion: SOPHiA expanded its partnership with AstraZeneca to accelerate the deployment of MSK-ACCES globally, now involving 30 sponsored institutions worldwide.
Product Development: The company is focusing on new applications like MSK-ACCES and MSK Impact, which are attracting interest from biopharma partners.
Cost Management: SOPHiA achieved a 24% year-over-year improvement in adjusted EBITDA loss, indicating effective cost management.
Revenue Guidance: SOPHiA GENETICS reaffirmed its full year revenue guidance for 2025 of $72 million to $76 million, representing 10% to 17% growth on a reported basis.
Adjusted EBITDA Loss Guidance: The company reaffirmed its full year adjusted EBITDA loss guidance of $35 million to $39 million.
Profitability Outlook: SOPHiA aims to approach adjusted EBITDA breakeven by the end of 2026 and achieve positive adjusted EBITDA in the second half of 2027.
Gross Margin Expectations: The company expects to expand gross margin beyond 2024 levels, driven by targeted investments in platform optimization.
Share Buyback Program: None
The earnings call presents a positive outlook with strong financial metrics, including a 13% YoY improvement in adjusted EBITDA and stable customer retention. The AstraZeneca partnership and growth in clinical and biopharma segments are promising, despite conservative guidance. The Q&A reveals strong momentum and optimism for 2026, with significant potential from MSK-ACCESS and biopharma segments. While some details remain confidential, overall sentiment is positive, suggesting a potential stock price increase of 2% to 8% over the next two weeks.
The earnings call highlights strong U.S. market growth, improved gross margins, and significant partnership expansion with AstraZeneca, which is the largest in the company's history. Despite an increase in operating loss, the company's strategic focus on new applications, customer growth, and cost management reflect a positive outlook. The Q&A section reinforces this sentiment with optimistic guidance on product adoption and contract value increases. Although management was conservative about disclosing specific contract sizes, the overall narrative suggests positive momentum, warranting a 'Positive' sentiment rating.
The earnings call presents mixed signals: positive revenue growth, improved EBITDA loss, and strong gross margins, but concerns over churn and competitive pressures. The Q&A highlights effective implementation and partnerships, yet lacks clarity on sustainable margins. No share buyback program and a cautious revenue guidance contribute to a neutral outlook.
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