Veracyte Announces Fourth Quarter and Full-Year 2021 Financial Results

Rhea-AI Summary

Veracyte reported significant growth in Q4 2021, achieving $67.3 million in revenue, a 95% increase year-over-year. For the full year, total revenue reached $219.5 million, up 87%. However, operating expenses rose 104% to $227.0 million, primarily due to acquisition-related costs, leading to a net loss of $75.6 million, a 116% increase. The company anticipates 2022 revenue to be between $260 million and $275 million, marking a growth of 18% to 25%.

Positive

• Fourth quarter revenue rose to $67.3 million, up 95% year-over-year.
• 2021 total revenue was $219.5 million, an 87% increase.
• Test volume increased by 70% in Q4 and 77% for the full year.
• Acquisitions of Decipher and HalioDx positioned Veracyte for global expansion.
• 2022 revenue guidance set at $260 million to $275 million, indicating 18% to 25% growth.

Negative

• Net loss increased to $75.6 million in 2021, up 116% from the previous year.
• Operating expenses in 2021 rose 104%, driven by acquisition-related costs.
• Basic and diluted net loss per share increased to $1.11, up 68%.

Grew Fourth Quarter 2021 Revenue to $67.3 Million, an Increase of 95%

Grew 2021 Revenue to $219.5 Million, an Increase of 87%

Conference Call and Webcast Today at 4:30 p.m. ET

SOUTH SAN FRANCISCO, Calif.--(BUSINESS WIRE)-- Veracyte, Inc. (Nasdaq: VCYT) today announced financial results for the fourth quarter and full year ended December 31, 2021.

“Our business continued to perform well in the fourth quarter, despite facing unanticipated COVID-related headwinds,” said Marc Stapley, Veracyte’s chief executive officer. “Moreover, 2021 was a pivotal year for Veracyte as we believe we put the major strategic pieces in place, including the acquisitions of Decipher and HalioDx, to position us to achieve our vision of becoming a global diagnostics leader. We look forward to building on this progress in 2022 with key milestones to support our near- and long-term growth.”

Fourth Quarter 2021 Financial Results

For the fourth quarter of 2021, as compared with the fourth quarter of 2020:

• Total Revenue was $67.3 million, an increase of 95%;
• Operating Expenses, Excluding Cost of Revenue, were $56.8 million, an increase of 81%;
• Net Loss was $10.5 million, an increase of 31%;
• Basic and Diluted Net Loss Per Common Share was $0.15, an increase of 7%;
• Net Cash Provided by Operating Activities was $8.4 million, an increase of $6.1 million; and
• Cash and Cash Equivalents were $173.2 million at December 31, 2021.

For the year ended December 31, 2021, compared to the prior year:

• Total Revenue was $219.5 million, an increase of 87%;
• Operating Expenses, Excluding Cost of Revenue, were $227.0 million, an increase of 104%, including $47.2 million of acquisition-related expenses;
• Net Loss was $75.6 million, an increase of 116%, including $47.2 million of acquisition-related expenses;
• Basic and Diluted Net Loss Per Common Share was $1.11, an increase of 68%, including $0.70 per share attributable to acquisition-related expenses; and
• Net Cash Used in Operating Activities was $31.6 million, including $43.6 million of acquisition-related expenses, compared to $9.7 million.

Key Business Highlights

• Grew test volume to 22,300 in the fourth quarter and 78,565 in full-year 2021, increases of 70% and 77%, respectively, compared to the prior year.
• Completed the acquisitions of Decipher Biosciences and HalioDx, positioning Veracyte to drive global expansion with a broad menu of high-performance tests.
• Published clinical utility studies for the Afirma, Percepta and Envisia genomic classifiers in the Journal of the American Society of Cytopathology, BMC Pulmonary Medicine and AnnalsATS, respectively.
• Broadened the clinical evidence for the Decipher Prostate Genomic Classifier including the presentation of data from a randomized Phase 3 trial at ASCO Genitourinary Symposium which demonstrated the test’s ability to guide therapy in men with intermediate-risk prostate cancer; received an expanded recommendation in 2022 National Comprehensive Cancer Network® (NCCN) Clinical Practice Guidelines for Oncology, which uniquely predicates treatment decisions based on patients’ Decipher Prostate test scores.
• Commercially launched the Decipher Bladder Genomic Classifier in November 2021 following a Medicare coverage policy and publication of strong clinical validation data in the Journal of Urology.
• Began running the Percepta Nasal Swab test for improved early detection of lung cancer in Veracyte’s CLIA lab and returned results to the first patients as Veracyte began to assemble the clinical utility evidence to support future reimbursement and guideline inclusion.
• Augmented and reorganized the leadership team to deliver on Veracyte’s global strategic vision.

2022 Financial Outlook

Veracyte is initiating 2022 annual total revenue guidance of $260 million to $275 million, representing year-over-year growth of 18% to 25%, compared to the prior year.

Conference Call and Webcast Details

Veracyte will host a conference call and webcast today at 4:30 p.m. Eastern Time to discuss the company's financial results and provide a general business update. The conference call will be webcast live from the company’s website and will be available via the following link: https://protect-us.mimecast.com/s/IyUzCADA4pUjMMGcmQqy2. The webcast should be accessed 10 minutes prior to the conference call start time. A replay of the webcast will be available for one year following the conclusion of the live broadcast and will be accessible on the company’s website at https://investor.veracyte.com/events-presentations.

The conference call can be accessed as follows:

U.S./Canada participant dial-in number (toll-free):			(855) 541-0980
International participant dial-in number:			(970) 315-0440
Conference I.D.:			5377945

About Veracyte

Veracyte (Nasdaq: VCYT) is a global diagnostics company that improves patient care by answering important clinical questions to inform diagnosis and treatment decisions throughout the patient journey. Our growing menu of advanced diagnostic tests help patients avoid risky, costly procedures and interventions, and reduce time to appropriate treatment. Our tests address eight of the 10 most prevalent cancers by incidence in the United States. In addition to making our tests available in the United States through our central laboratories, our exclusive license to a best-in-class diagnostics instrument positions us to deliver our tests to patients worldwide through laboratories that can perform them locally. Veracyte is based in South San Francisco, California. For more information, please visit www.veracyte.com and follow the company on Twitter (@veracyte).

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements, including, but not limited to, our statements related to our expected total revenue and other financial and operating results for 2022 and our plans, objectives, expectations (financial and otherwise) or intentions with respect to our Prosigna, Afirma, Percepta, Envisia, LymphMark, Decipher Prostate, Percepta Nasal Swab, Percepta Genomic Atlas and Decipher Bladder tests and products for use in diagnosing and treating diseases, Medicare coverage, and our commercial organization. Forward-looking statements can be identified by words such as: “appears,” "anticipate," "intend," "plan," "expect," "believe," "should," "may," "will," “positioned,” “designed” and similar references to future periods. Actual results may differ materially from those projected or suggested in any forward-looking statements. These statements involve risks and uncertainties, which could cause actual results to differ materially from our predictions, and include, but are not limited to our ability to launch, commercialize and receive reimbursement for our products, to successfully integrate the HalioDx and Decipher businesses and execute on our business plans; continue to scale our global operations and enhance our internal control environment; the impact of the COVID-19 pandemic and its variants on our business and general economic conditions; and the performance and utility of our tests in the clinical environment. Additional factors that may impact these forward-looking statements can be found under the caption “Risk Factors” in our Quarterly Report on Form 10-Q filed with the SEC on November 9, 2022 and our Annual Report on Form 10-K to be filed for the year ended December 31, 2021. Copies of these documents, when available, may be found in the Investors section of our website at www.investor.veracyte.com. These forward-looking statements speak only as of the date hereof and, except as required by law, we specifically disclaim any obligation to update these forward-looking statements or reasons why actual results might differ, whether as a result of new information, future events or otherwise.

Veracyte, the Veracyte logo, HalioDx, Decipher, Decipher GRID, Afirma, Percepta, Envisia, Prosigna, LymphMark, Immunoscore, TMExplore, Brightplex, Immunosign, “Know by Design” and “More about You” are registered trademarks of Veracyte, Inc. and its subsidiaries in the U.S. and selected countries. nCounter is the registered trademark of NanoString Technologies, Inc. in the U.S. and selected countries and used by Veracyte under license.

VERACYTE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands of dollars, except share and per share amounts)
		Three Months Ended December 31,								Twelve Months Ended December 31,
		2021				2020				2021				2020
Revenues:
Testing revenue		$	53,414			$	31,497			$	188,182			$	101,970
Product revenue			2,758				2,696				11,464				9,845
Biopharmaceutical and other revenue			11,164				343				19,868				5,668
Total revenue			67,336				34,536				219,514				117,483
Operating expenses(1):
Cost of testing revenue			16,366				9,756				58,860				35,913
Cost of product revenue			1,583				1,382				5,887				4,921
Cost of biopharmaceutical and other revenue			4,933				49				9,653				621
Research and development			10,252				4,586				29,843				17,204
Selling and marketing			22,212				13,149				79,840				52,389
General and administrative			18,849				12,413				101,353				36,729
Intangible asset amortization			5,474				1,273				15,981				5,095
Total operating expenses			79,669				42,608				301,417				152,872
Loss from operations			(12,333	)			(8,072	)			(81,903	)			(35,389	)
Other income, net			1,016				28				254				480
Loss before income tax benefit			(11,317	)			(8,044	)			(81,649	)			(34,909	)
Income tax benefit			(789	)			—				(6,086	)			—
Net loss		$	(10,528	)		$	(8,044	)		$	(75,563	)		$	(34,909	)
Net loss per common share, basic and diluted		$	(0.15	)		$	(0.14	)		$	(1.11	)		$	(0.66	)
Shares used to compute net loss per common share, basic and diluted			71,064,467				58,023,753				67,890,328				53,239,231
(1) Cost of revenue, research and development, sales and marketing and general and administrative expenses include the following stock-based compensation related expenses:
		Three Months Ended December 31,								Twelve Months Ended December 31,
		2021				2020				2021				2020
HalioDx stock-based compensation expense		$	1,376			$	—			$	3,944			$	—
Other stock-based compensation expense			5,438				3,640				19,024				12,995
Total stock-based compensation expense		$	6,814			$	3,640			$	22,968			$	12,995

VERACYTE, INC.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS
(Unaudited)
(In thousands)
	Three Months Ended December 31,								Twelve Months Ended December 31,
	2021				2020				2021				2020
Net loss	$	(10,528	)		$	(8,044	)		$	(75,563	)		$	(34,909	)
Other comprehensive loss:
Change in currency translation adjustments		(6,943	)			—				(15,083	)			—
Net comprehensive loss	$	(17,471	)		$	(8,044	)		$	(90,646	)		$	(34,909	)

VERACYTE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
		December 31,			December 31,
		2021			2020
		(Unaudited)			(See Note 1)
Assets
Current assets:
Cash and cash equivalents		$	173,197		$	349,364
Accounts receivable			41,461			18,461
Supplies			11,225			4,657
Prepaid expenses and other current assets			17,219			3,197
Total current assets			243,102			375,679
Property and equipment, net			15,098			8,990
Right-of-use assets - operating leases			16,043			7,843
Intangible assets, net			202,731			59,924
Goodwill			707,904			2,725
Restricted cash			749			603
Other assets			2,198			1,399
Total assets		$	1,187,825		$	457,163
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable		$	12,360		$	3,116
Accrued liabilities			39,475			11,705
Current portion of long-term debt			1,127			—
Current portion of deferred revenue			4,646			371
Current portion of acquisition-related contingent consideration			2,682			—
Current portion of operating lease liabilities			3,630			1,589
Current portion of other liabilities			231			—
Total current liabilities			64,151			16,781
Long-term debt			—			810
Deferred revenue, net of current portion			343			829
Deferred tax liability			5,592			—
Acquisition related contingent consideration, net of current portion			5,722			7,594
Operating lease liabilities, net of current portion			14,096			9,917
Other liabilities			1,407			—
Total liabilities			91,311			35,931
Total stockholders’ equity			1,096,514			421,232
Total liabilities and stockholders’ equity		$	1,187,825		$	457,163
1 The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date included in the Company's Form 10-K filed with the Securities and Exchange Commission dated February 22, 2021.

VERACYTE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands of dollars)
		Twelve Months Ended December 31,
		2021				2020
Operating activities
Net loss		$	(75,563	)		$	(34,909	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			19,593				7,944
Stock-based compensation			22,519				12,995
Benefit from income taxes			(6,258	)			—
Interest on end-of-term debt obligations			216				216
Write-down of excess supplies			—				1,088
Noncash lease expense			1,632				964
Revaluation of acquisition-related contingent consideration			810				1,506
Impairment loss			—				1,000
Effect of foreign currency on operations			1,211				(34	)
Changes in operating assets and liabilities:
Accounts receivable			(8,571	)			955
Supplies			(1,464	)			1,061
Prepaid expenses and other current assets			(3,316	)			(970	)
Other assets			(216	)			37
Operating lease liability			(1,794	)			(1,407	)
Accounts payable			5,155				711
Accrued liabilities and deferred revenue			14,425				(868	)
Net cash used in operating activities			(31,621	)			(9,711	)
Investing activities
Acquisition of Decipher Biosciences, net of cash acquired			(574,411	)			—
Acquisition of HalioDx, net of cash acquired			(162,419	)			—
Proceeds from sale of equity securities			3,000				—
Purchase of equity securities			—				(1,000	)
Purchases of property and equipment			(5,376	)			(2,837	)
Net cash used in investing activities			(739,206	)			(3,837	)
Financing activities
Proceeds from the issuance of common stock in a public offering, net of issuance costs			593,821				193,831
Payment of long-term debt			—				(100	)
Payment of taxes on vested restricted stock units			(9,029	)			(3,845	)
Proceeds from the exercise of common stock options and employee stock purchases			11,528				13,709
Net cash provided by financing activities			596,320				203,595
(Decrease) increase in cash, cash equivalents and restricted cash			(174,507	)			190,047
Effect of foreign currency on cash, cash equivalents and restricted cash			(1,514	)			—
Net (decrease) increase in cash, cash equivalents and restricted cash			(176,021	)			190,047
Cash, cash equivalents and restricted cash at beginning of period			349,967				159,920
Cash, cash equivalents and restricted cash at end of period		$	173,946			$	349,967

CASH, CASH EQUIVALENTS AND RESTRICTED CASH
(Unaudited)
(In thousands of dollars)
	December 31,			December 31,
	2021			2020
Cash and cash equivalents	$	173,197		$	349,364
Restricted cash		749			603
Total cash, cash equivalents and restricted cash	$	173,946		$	349,967

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220228005793/en/

Investor and Media Contact:

Tracy Morris

Vice President of Corporate Communications & Investor Relations

650-380-4413

tracy.morris@veracyte.com

Source: Veracyte, Inc.

FAQ

What was Veracyte's revenue for Q4 2021?

Veracyte reported revenue of $67.3 million for Q4 2021, representing a 95% increase year-over-year.

How much did Veracyte grow its revenue in 2021?

Veracyte's total revenue for 2021 was $219.5 million, an increase of 87% compared to 2020.

What is Veracyte's revenue guidance for 2022?

Veracyte has provided a revenue guidance range of $260 million to $275 million for 2022, reflecting growth of 18% to 25%.

What were Veracyte's key business highlights in 2021?

Key highlights include the completion of acquisitions, increases in test volume, and the commercial launch of new genomic classifiers.