Delivered Total Revenue of $280.3 Million,
Exceeding the High End of Updated Guidance for 2023
Grew Testing Services Results for the Second
Quarter in a Row
CareDx, Inc. (Nasdaq: CDNA) today reported financial results for
the fourth quarter and full year ended December 31, 2023.
Fourth Quarter and Full Year 2023
Highlights
- Reported full year revenue of $280.3 million, exceeding the
high end of updated guidance for 2023.
- Reported full year Testing Services revenue of $209.7 million
and delivered approximately 165,700 patient results in 2023.
- Grew Testing Services patient results for the second quarter in
a row to approximately 39,900, an increase of 4% as compared to the
third quarter of 2023.
- Reported full year revenue of $37.1 million for Patient and
Digital Solutions and $33.5 million for Product, representing
year-over-year growth of 29% and 15%, respectively.
- Ended 2023 with cash and cash equivalents, and marketable
securities of approximately $235.4 million, with no debt.
- Achieved the fifth consecutive quarter of collections at over
100% of Testing Services revenue driven by revenue cycle management
initiatives. Collected $17 million in cash over its revenue in
2023.
- Repurchased 2.9 million shares of common stock for $27.5
million under share buyback program in 2023.
- Received Medicare coverage for HeartCare and AlloSure
Lung.
- CareDx is in the process of seeking judicial review of January
2024 jury decision and monetary damages related to alleged
infringement of patent ‘544.
“In 2023, we met our challenges head-on as we navigated the
impact of Medicare coverage changes. We reset our operations,
strategically reduced our cost structure, and created a growth
pathway for the company in the second half of the year, as we
continued to focus on care for transplant patients,” said Alex
Johnson, President of Patient and Testing Services, and a member of
the Office of the CEO at CareDx. “Looking forward to 2024, we are
focused on delivering high-value clinical and digital solutions to
improve allograft survival, while generating evidence for expanding
payer coverage and accelerating our path back to
profitability.”
Q4 2023 Financial Results
Revenue for the three months ended December 31, 2023, was $65.6
million, a decrease of 20% compared with $82.4 million for the
fourth quarter of 2022. Testing Services revenue for the fourth
quarter 2023 was $46.7 million, a decrease of 29% compared with
$65.4 million in the same period in 2022. Testing Services revenue
was negatively impacted due to the Medicare Billing Article
changes.
Total AlloSure and AlloMap patient results provided in the
fourth quarter 2023 were approximately 39,900, a decrease of 16% as
compared to the same quarter a year ago, and an increase of 4%
compared to the third quarter of 2023. Patient and Digital
Solutions revenue for the fourth quarter 2023 was $9.6 million,
compared to $8.4 million in the same period in 2022, an increase of
14%. Product revenue for the fourth quarter 2023 was $9.2 million,
compared to $8.6 million in the same period in 2022, an increase of
8%.
For the fourth quarter of 2023, net loss was $118.1 million,
including $96.3 million accrual associated with damages related to
alleged infringement of patent ‘544, compared to a net loss of
$18.3 million in the fourth quarter of 2022. Basic and diluted net
loss per share in the fourth quarter of 2023 was $2.21, compared to
basic and diluted net loss per share of $0.34 in the fourth quarter
of 2022.
Non-GAAP net loss was $9.3 million in the fourth quarter of
2023, compared to a non-GAAP net loss of $3.7 million in the fourth
quarter of 2022. Basic and diluted non-GAAP net loss per share was
$0.17 in the fourth quarter of 2023, compared to a basic and
diluted non-GAAP net loss per share of $0.07 in the fourth quarter
of 2022.
Adjusted EBITDA for the fourth quarter of 2023 was a loss of
$10.3 million, compared to an adjusted EBITDA loss of $3.7 million
in the fourth quarter of 2022.
Full Year 2023 Financial Results
Total revenue for the full year ended December 31, 2023, was
$280.3 million, a decrease of 13% compared with $321.8 million in
2022. Testing Services revenue for the full year 2023 was $209.7
million, compared with $263.7 million in 2022, a decrease of 20%.
Patient and Digital Solutions revenue for the full year 2023 was
$37.1 million, compared to $28.8 million in 2022, an increase of
29%. Product revenue for the full year 2023 was $33.5 million,
compared to $29.3 million in 2022, an increase of 15%.
Net loss for the full year 2023 was $190.3 million, including
$96.3 million accrual associated with damages related to alleged
infringement of patent ‘544, compared to a net loss of $76.6
million in 2022. Basic and diluted net loss per share for the full
year 2023 was $3.54, compared to basic and diluted net loss per
share of $1.44 in the full year 2022.
Non-GAAP net loss was $34.5 million for the full year 2023,
compared to a non-GAAP net loss of $20.9 million for the full year
ended 2022. Basic and diluted non-GAAP net loss per share was $0.64
in the full year of 2023, compared to a basic and diluted non-GAAP
net loss per share of $0.39 in the full year of 2022.
Adjusted EBITDA for the full year of 2023 was a loss of $38.0
million, compared to an adjusted EBITDA loss of $17.5 million for
the full year of 2022.
Cash and cash equivalents and marketable securities were $235.4
million as of December 31, 2023. Reduced cash used in operations
from $25.2 million in 2022 to $18.4 million in 2023.
For additional information regarding non-GAAP financial measures
discussed herein, please see “Use of Non-GAAP Financial Measures,”
“Reconciliation of GAAP to Non-GAAP Financial Measures,”
“Reconciliation of GAAP to Non-GAAP Gross Profit and Gross Margin,”
and “Reconciliation of Non-GAAP to Adjusted EBITDA Financial
Measures” below.
2024 Guidance
For the full year 2024, CareDx expects revenue to be in the
range of $260 million to $274 million.
About CareDx – The Transplant Company
CareDx, Inc., headquartered in Brisbane, California, is a
leading precision medicine solutions company focused on the
discovery, development, and commercialization of clinically
differentiated, high-value healthcare solutions for transplant
patients and caregivers. CareDx offers testing services, products,
and digital healthcare solutions along the pre- and post-transplant
patient journey, and is the leading provider of genomics-based
information for transplant patients. For more information, please
visit: www.CareDx.com.
Forward-Looking Statements
This press release includes forward-looking statements,
including expectations regarding CareDx’s 2024 revenue, CareDx’s
plans to seek judicial review of jury decision and historical
monetary damages on patent ‘544, CareDx’s focus in 2024 and
CareDx’s proposed path to profitability. These forward-looking
statements are based upon information that is currently available
to CareDx and its current expectations, speak only as of the date
hereof, and are subject to numerous risks and uncertainties, all of
which are difficult to predict and many of which are beyond our
control, including general economic and market factors, and global
economic and marketplace uncertainties related to the COVID-19
pandemic, among others discussed in CareDx’s filings with the
Securities and Exchange Commission (the “SEC”), including, but not
limited to, the Annual Report on Form 10-K for the fiscal year
ended December 31, 2023 filed by CareDx with the SEC on February
28, 2024, and other reports that CareDx has filed with the SEC. Any
of these may cause CareDx’s actual results, performance, or
achievements to differ materially and adversely from those
anticipated or implied by CareDx’s forward-looking statements. You
are cautioned not to place undue reliance on these forward-looking
statements. CareDx expressly disclaims any obligation, except as
required by law, or undertaking to update or revise any such
forward-looking statements, whether as a result of new information,
future events or otherwise.
Use of Non-GAAP Financial Measures
CareDx has presented in this release certain financial
information in accordance with U.S. Generally Accepted Accounting
Principles (GAAP) and also on a non-GAAP basis, including non-GAAP
cost of testing services, non-GAAP cost of product, non-GAAP cost
of patient and digital solutions, non-GAAP research and development
expenses, non-GAAP sales and marketing expenses, non-GAAP general
and administrative expenses, non-GAAP other income, net, non-GAAP
income tax expense, non-GAAP gross profit, non-GAAP gross margin
(%), non-GAAP net loss, non-GAAP basic and diluted net loss per
share, adjusted EBITDA, and non-GAAP operating expenses.
We define non-GAAP net loss and per share results as the GAAP
net loss and per share results excluding the impacts of stock-based
compensation; changes in estimated fair value of contingent
consideration; acquisition-related impairment charges and
amortization of purchased intangible assets and related tax
effects; costs involved with completing an acquisition; unrealized
loss on investments; realized gain on investments; restructuring
charges and certain other charges. We define adjusted EBITDA as
non-GAAP net loss before net interest income, income tax expense,
depreciation and other (income) expense, net.
We are presenting these non-GAAP financial measures to assist
investors in assessing our operating results through the eyes of
management and because we believe that these measures provide an
additional tool for investors to use in comparing our core business
operating results over multiple periods. Management believes this
non-GAAP information is useful for investors, when considered in
conjunction with CareDx’s GAAP financial statements, because
management uses such information internally for its operating,
budgeting and financial planning purposes. Non-GAAP information is
not prepared under a comprehensive set of accounting rules and
should only be used to supplement an understanding of CareDx’s
operating results as reported under GAAP. These non-GAAP financial
measures should not be considered in isolation from, or as a
substitute for, financial information prepared in accordance with
GAAP. These non-GAAP financial measures are not necessarily
comparable to similarly titled measures presented by other
companies. A reconciliation between GAAP and non-GAAP financial
information is provided immediately following the financial
tables.
CareDx, Inc.
Consolidated Statements of
Operations
(Unaudited)
(In thousands, except share
and per share data)
Three Months Ended December
31,
Twelve Months Ended December
31,
2023
2022
2023
2022
Revenue:
Testing services revenue
$
46,703
$
65,418
$
209,685
$
263,748
Product revenue
9,244
8,555
33,517
29,251
Patient and digital solutions
9,622
8,411
37,122
28,794
Total revenue
65,569
82,384
280,324
321,793
Operating expenses:
Cost of testing services
13,805
18,657
57,642
72,286
Cost of product
5,637
4,617
18,379
17,639
Cost of patient and digital solutions
6,171
6,216
25,978
22,287
Research and development
18,276
23,570
81,866
90,388
Sales and marketing
19,999
23,668
83,334
96,027
General and administrative
26,541
24,776
117,868
100,397
Restructuring costs
1,472
—
2,320
—
Litigation expense
96,300
—
96,300
—
Total operating expenses
188,201
101,504
483,687
399,024
Loss from operations
(122,632
)
(19,120
)
(203,363
)
(77,231
)
Other income (expense):
Interest income, net
3,159
1,870
11,867
3,762
Change in estimated fair value of common
stock warrant liability
—
18
10
107
Other income (expense), net
1,541
(924
)
1,343
(2,872
)
Total other income
4,700
964
13,220
997
Loss before income taxes
(117,932
)
(18,156
)
(190,143
)
(76,234
)
Income tax expense
(165
)
(173
)
(141
)
(379
)
Net loss
$
(118,097
)
$
(18,329
)
$
(190,284
)
$
(76,613
)
Net loss per share:
Basic
$
(2.21
)
$
(0.34
)
$
(3.54
)
$
(1.44
)
Diluted
$
(2.21
)
$
(0.34
)
$
(3.54
)
$
(1.44
)
Weighted-average shares used to compute
net loss per share:
Basic
53,388,830
53,524,637
53,764,705
53,321,625
Diluted
53,388,830
53,524,637
53,764,705
53,321,625
CareDx, Inc.
Consolidated Balance
Sheets
(In thousands)
As of December 31,
2023
2022
Assets
Current assets:
Cash and cash equivalents
$
82,197
$
89,921
Marketable securities
153,221
203,168
Accounts receivable
51,061
66,312
Inventory
19,471
19,232
Prepaid and other current assets
7,763
9,216
Total current assets
313,713
387,849
Property and equipment, net
35,246
35,529
Operating leases right-of-use assets
29,891
34,689
Intangible assets, net
45,701
43,051
Goodwill
40,336
37,523
Restricted cash
586
522
Other assets
1,353
3,828
Total assets
$
466,826
$
542,991
Liabilities and stockholders’
equity
Current liabilities:
Accounts payable
$
12,872
$
9,942
Accrued compensation
19,703
16,902
Accrued and other liabilities
45,497
49,131
Total current liabilities
78,072
75,975
Deferred tax liability
136
—
Common stock warrant liability
—
32
Deferred payments for intangible
assets
2,461
2,418
Operating lease liability, less current
portion
28,278
33,406
Other liabilities
96,551
249
Total liabilities
205,498
112,080
Commitments and contingencies
Stockholders’ equity:
Common stock
49
52
Additional paid-in capital
946,511
898,806
Accumulated other comprehensive loss
(6,963
)
(7,503
)
Accumulated deficit
(678,269
)
(460,444
)
Total stockholders’ equity
261,328
430,911
Total liabilities and stockholders’
equity
$
466,826
$
542,991
CareDx, Inc.
Reconciliation of GAAP to
Non-GAAP Financial Measures
(Unaudited)
(In thousands)
Three Months Ended December
31,
Twelve Months Ended December
31,
2023
2022
2023
2022
Cost of testing services
reconciliation:
GAAP cost of testing services
$
13,805
$
18,657
$
57,642
$
72,286
Stock-based compensation expense
(387
)
(474
)
(1,854
)
(1,529
)
Acquisition related-amortization of
purchased intangibles
(329
)
(329
)
(1,316
)
(1,316
)
Non-GAAP cost of testing services
$
13,089
$
17,854
$
54,472
$
69,441
Cost of product reconciliation:
GAAP cost of product
$
5,750
$
4,617
$
18,492
$
17,639
Stock-based compensation expense
(230
)
(269
)
(1,165
)
(1,120
)
Acquisition related-amortization of
purchased intangibles
(413
)
(411
)
(1,655
)
(1,716
)
Restructuring costs
(113
)
—
(113
)
—
Non-GAAP cost of product
$
4,994
$
3,937
$
15,559
$
14,803
Cost of patient and digital solutions
reconciliation:
GAAP cost of patient and digital
solutions
$
6,226
$
6,216
$
26,047
$
22,287
Stock-based compensation expense
(311
)
(449
)
(1,377
)
(1,331
)
Acquisition related-amortization of
purchased intangibles
(271
)
(236
)
(1,039
)
(945
)
Restructuring costs
(55
)
—
(69
)
—
Non-GAAP cost of patient and digital
solutions
$
5,589
$
5,531
$
23,562
$
20,011
Research and development expenses
reconciliation:
GAAP research and development expenses
$
18,617
$
23,570
$
82,452
$
90,388
Stock-based compensation expense
(1,399
)
(820
)
(6,556
)
(7,391
)
Asset impairments and write-downs
—
—
—
(340
)
Restructuring costs
(341
)
—
(586
)
—
Non-GAAP research and development
expenses
$
16,877
$
22,750
$
75,310
$
82,657
Sales and marketing expenses
reconciliation:
GAAP sales and marketing expenses
$
20,254
$
23,668
$
84,137
$
96,027
Stock-based compensation expense
(2,913
)
(4,701
)
(12,470
)
(14,403
)
Acquisition related-amortization of
purchased intangibles
(641
)
(550
)
(2,457
)
(2,252
)
Restructuring costs
(255
)
—
(803
)
—
Non-GAAP sales and marketing expenses
$
16,445
$
18,417
$
68,407
$
79,372
General and administrative expenses
reconciliation:
GAAP general and administrative
expenses
$
123,549
$
24,776
$
214,917
$
100,397
Stock-based compensation expense
(4,720
)
(5,413
)
(25,664
)
(20,779
)
Change in estimated fair value of
contingent consideration
(946
)
103
(2,677
)
(727
)
Acquisition related fees and expenses
(51
)
(212
)
(589
)
(599
)
Restructuring costs
(708
)
—
(749
)
—
Litigation expense
(96,300
)
—
(96,300
)
—
Other charges
—
—
(64
)
—
Non-GAAP general and administrative
expenses
$
20,824
$
19,254
$
88,874
$
78,292
Total other (expense) income
reconciliation:
GAAP other expense, net
$
4,700
$
964
$
13,220
$
997
Unrealized loss on investments
—
965
1,190
1,181
Realized gain on investment
(1,468
)
—
(1,468
)
—
Investment impairment
—
—
1,000
500
Other charges (income)
—
11
(2,081
)
43
Non-GAAP other income, net
$
3,232
$
1,940
$
11,861
$
2,721
Income tax expense reconciliation:
GAAP income tax expense
$
(165
)
$
(173
)
$
(141
)
$
(379
)
Tax effect related to amortization of
purchased intangibles
(99
)
(98
)
(398
)
(419
)
Non-GAAP income tax expense
$
(264
)
$
(271
)
$
(539
)
$
(798
)
CareDx, Inc.
GAAP and Non-GAAP Operating
Expenses
(Unaudited)
(In thousands)
Three Months Ended December
31,
Twelve Months Ended December
31,
2023
2022
2023
2022
GAAP operating expenses:
Research and development
$
18,617
$
23,570
$
82,452
$
90,388
Sales and marketing
20,254
23,668
84,137
96,027
General and administrative
123,549
24,776
214,917
100,397
Total GAAP operating expenses
$
162,420
$
72,014
$
381,506
$
286,812
Non-GAAP operating expenses:
Research and development
$
16,877
$
22,750
$
75,310
$
82,657
Sales and marketing
16,445
18,417
68,407
79,372
General and administrative
20,824
19,254
88,874
78,292
Total Non-GAAP operating expenses
$
54,146
$
60,421
$
232,591
$
240,321
CareDx, Inc.
Reconciliation of GAAP to
Non-GAAP Gross Profit and Gross Margin
(Unaudited)
(In thousands, except
percentages)
Three Months Ended December
31,
Twelve Months Ended December
31,
2023
2022
2023
2022
Total revenue
$
65,569
$
82,384
$
280,324
$
321,793
GAAP cost of sales
25,781
29,490
102,181
112,212
GAAP gross profit
39,788
52,894
178,143
209,581
Stock-based compensation expense
928
1,192
4,396
3,980
Restructuring costs
168
—
182
—
Acquisition related-amortization of
purchased intangibles
1,013
976
4,010
3,977
Non-GAAP gross profit
$
41,897
$
55,062
$
186,731
$
217,538
Non-GAAP gross margin %
64
%
67
%
67
%
68
%
CareDx, Inc.
Reconciliation of GAAP to
Non-GAAP Financial Measures
(Unaudited)
(In thousands, except share
and per share data)
Three Months Ended December
31,
Twelve Months Ended December
31,
2023
2022
2023
2022
GAAP net loss
$
(118,097
)
$
(18,329
)
$
(190,284
)
$
(76,613
)
Stock-based compensation expense
9,960
12,126
49,086
46,553
Unrealized loss on investments
—
965
1,190
1,181
Realized gain on investments
(1,468
)
—
(1,468
)
—
Acquisition related-amortization of
purchased intangibles
1,654
1,526
6,467
6,229
Acquisition related fees and expenses
51
212
589
599
Change in estimated fair value of
contingent consideration
946
(103
)
2,677
727
Tax effect related to amortization of
purchased intangibles
(99
)
(98
)
(398
)
(419
)
Asset impairments and write-downs
—
—
1,000
840
Litigation expense
96,300
—
96,300
—
Restructuring costs
1,472
—
2,320
—
Other charges
—
11
(2,017
)
43
Non-GAAP net loss
$
(9,281
)
$
(3,690
)
$
(34,538
)
$
(20,860
)
GAAP basic and diluted net loss per
share
$
(2.21
)
$
(0.34
)
$
(3.54
)
$
(1.44
)
Non-GAAP basic net loss per share
$
(0.17
)
$
(0.07
)
$
(0.64
)
$
(0.39
)
Non-GAAP diluted net loss per share
$
(0.17
)
$
(0.07
)
$
(0.64
)
$
(0.39
)
Shares used in computing non-GAAP basic
net loss per share
53,388,830
53,524,637
53,764,705
53,321,625
Shares used in computing non-GAAP diluted
net loss per share
53,388,830
53,524,637
53,764,705
53,321,625
CareDx, Inc.
Reconciliation of Non-GAAP to
Adjusted EBITDA Financial Measures
(Unaudited)
(In thousands)
Three Months Ended December
31,
Twelve Months Ended December
31,
2023
2022
2023
2022
Non-GAAP net loss
$
(9,281
)
$
(3,690
)
$
(34,538
)
$
(20,860
)
Interest income
(3,159
)
(1,870
)
(11,867
)
(3,762
)
Income tax expense
264
272
539
798
Depreciation expense
1,978
1,682
7,882
5,248
Other (income) expense, net
(72
)
(70
)
7
1,041
Adjusted EBITDA
$
(10,270
)
$
(3,676
)
$
(37,977
)
$
(17,535
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240228248706/en/
CareDx, Inc. Media Relations Anna Czene 818-731-2203
aczene@caredx.com
Investor Relations Greg Chodaczek investor@CareDx.com
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