# CareDx, Inc. (CDNA)

Informational only - not investment advice.

CIK: 0001217234
SIC: 8071 Services-Medical Laboratories
SIC breadcrumb: [Services](/division/I/) > [SIC Major Group 80](/major-group/80/) > [SIC 8071 Services-Medical Laboratories](/industry/8071/)
Latest 10-K filed: 2026-02-25
SEC page: https://www.sec.gov/edgar/browse/?CIK=1217234
Filing source: https://www.sec.gov/Archives/edgar/data/1217234/000121723426000018/cdna-20251231.htm

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 379805000 | USD | 2025 | 2026-02-25 |
| Net income | -21354000 | USD | 2025 | 2026-02-25 |
| Assets | 413228000 | USD | 2025 | 2026-02-25 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-25. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001217234.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue | 40,631,000 | 48,324,000 | 76,569,000 | 127,068,000 | 192,194,000 | 296,397,000 | 321,793,000 | 280,324,000 | 333,785,000 | 379,805,000 |
| Net income | -39,469,000 | -55,469,000 | -46,756,000 | -21,968,000 | -18,714,000 | -30,662,000 | -76,613,000 | -190,284,000 | 52,549,000 | -21,354,000 |
| Operating income | -37,332,000 | -20,294,000 | -15,578,000 | -24,532,000 | -22,528,000 | -29,726,000 | -77,231,000 | -203,363,000 | 40,765,000 | -30,781,000 |
| Diluted EPS | -2.39 | -2.38 | -1.31 | -0.52 | -0.40 | -0.59 | -1.44 | -3.54 | 0.93 | -0.40 |
| Operating cash flow | -16,523,000 | -14,307,000 | -4,007,000 | -2,769,000 | 33,431,000 | -19,294,000 | -25,239,000 | -18,388,000 | 38,048,000 | 42,032,000 |
| Share buybacks |  |  |  |  | 0.00 | 0.00 | 642,000 | 27,541,000 | 522,000 | 87,768,000 |
| Assets | 76,730,000 | 83,565,000 | 130,697,000 | 151,736,000 | 368,511,000 | 566,621,000 | 542,991,000 | 466,826,000 | 491,050,000 | 413,228,000 |
| Liabilities | 56,969,000 | 89,519,000 | 34,769,000 | 52,736,000 | 90,832,000 | 100,745,000 | 112,080,000 | 205,498,000 | 112,617,000 | 110,127,000 |
| Stockholders' equity | 19,482,000 | -6,134,000 | 95,928,000 | 99,000,000 | 277,679,000 | 465,876,000 | 430,911,000 | 261,328,000 | 378,433,000 | 303,101,000 |
| Cash and cash equivalents | 17,258,000 | 16,895,000 | 64,616,000 | 38,223,000 | 134,669,000 | 348,485,000 | 89,921,000 | 82,197,000 | 114,689,000 | 65,429,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin | -97.14% | -114.79% | -61.06% | -17.29% | -9.74% | -10.34% | -23.81% | -67.88% | 15.74% | -5.62% |
| Operating margin | -91.88% | -42.00% | -20.35% | -19.31% | -11.72% | -10.03% | -24.00% | -72.55% | 12.21% | -8.10% |
| Return on equity | -202.59% |  | -48.74% | -22.19% | -6.74% | -6.58% | -17.78% | -72.81% | 13.89% | -7.05% |
| Return on assets | -51.44% | -66.38% | -35.77% | -14.48% | -5.08% | -5.41% | -14.11% | -40.76% | 10.70% | -5.17% |
| Liabilities / equity | 2.92 |  | 0.36 | 0.53 | 0.33 | 0.22 | 0.26 | 0.79 | 0.30 | 0.36 |
| Current ratio | 0.65 | 0.62 | 4.16 | 2.07 | 3.95 | 5.61 | 5.10 | 4.02 | 3.94 | 2.86 |

## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-04-28. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001217234.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q2 | 2022-06-30 |  |  | -0.41 | reported discrete quarter |
| 2022-Q3 | 2022-09-30 |  |  | -0.32 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | -0.44 | reported discrete quarter |
| 2023-Q2 | 2023-03-31 |  | -23,749,000 |  | reported discrete quarter |
| 2023-Q2 | 2023-06-30 | 70,301,000 |  | -0.46 | reported discrete quarter |
| 2023-Q3 | 2023-06-30 |  | -24,953,000 |  | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 67,192,000 |  | -0.43 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 65,569,000 | -118,097,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 | 72,049,000 | -16,659,000 | -0.32 | reported discrete quarter |
| 2024-Q2 | 2024-03-31 |  | -16,659,000 |  | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 92,274,000 |  | -0.03 | reported discrete quarter |
| 2024-Q3 | 2024-06-30 |  | -1,394,000 |  | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 82,883,000 |  | -0.14 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 86,579,000 | 78,010,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 84,685,000 | -10,353,000 | -0.19 | reported discrete quarter |
| 2025-Q2 | 2025-03-31 |  | -10,353,000 |  | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 86,679,000 |  | -0.16 | reported discrete quarter |
| 2025-Q3 | 2025-06-30 |  | -8,568,000 |  | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 100,055,000 |  | 0.03 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 108,386,000 | -4,108,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-03-31 | 117,700,000 | 2,809,000 | 0.05 | reported discrete quarter |

## Macro Cross-References
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- [IR](/indicator/IR/): Import Price Index (End Use): All Commodities
- [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1217234/000121723426000033/cdna-20260331.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary.
Confidence: high
Filing date: 2026-04-28
Report date: 2026-03-31

ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read together with the unaudited condensed consolidated financial statements and related notes included elsewhere in Item 1 of Part I of this Quarterly Report on Form 10-Q and with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the Securities and Exchange Commission, or the SEC, on February 25, 2026.

Overview

We are a precision medicine company dedicated to improving outcomes for transplant patients and advancing organ health. We deliver solutions designed to empower clinicians and improve patient outcomes. Our integrated solutions include non-invasive molecular testing for heart, kidney, and lung transplants; laboratory products; digital health technologies; and patient solutions that support care before and after transplant. We are the leading provider of genomics-based information for transplant patients.

Our commercially available post-transplant testing services consist of AlloSure® Kidney, a donor-derived cell-free DNA, or dd-cfDNA, solution for kidney transplant patients, AlloMap® Heart, a gene expression profiling solution for heart transplant patients, AlloSure® Heart, a dd-cfDNA solution for heart transplant patients, HeartCare, the combined use of AlloMap Heart and AlloSure Heart, and AlloSure® Lung, a dd-cfDNA solution for lung transplant patients. We have initiated several clinical studies to generate data on our existing and planned future testing services. From time to time, we partner with pharma and biopharma companies to use our technology and tests, often in clinical trials, to identify or screen for patients that may be appropriate candidates for their products. We also offer high-quality products in the pre-transplant space that increase the chance of successful transplants by facilitating a better match between a donor and a recipient of stem cells and organs. We also provide digital transplant solutions and various offerings that help transplant centers with patient management, outcomes quality and operational support.

Highlights for the Three Months Ended March 31, 2026

•Revenue of $118 million, an increase of 39% year-over-year

•    Testing services revenue of $91 million, an increase of 48% year-over-year, and testing services volume of approximately 54,900, an increase of 17% year-over-year

•    Patient and digital solutions revenue of $16 million and lab product revenue of $10 million, representing year-over-year growth of 33% and a decline of 4%, respectively

•    Average revenue per test of approximately $1,660 including approximately $14 million in prior period revenue

•    Net income of $3 million, compared to net loss of $10 million for the first quarter of 2025

•    Cash flow from operations of $4 million

Financial Operations Overview

Revenue

We derive our revenue from testing services, products sales, patient and digital solutions revenues. Revenue is recorded considering a five-step revenue recognition model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations and recognizing revenue when, or as, an entity satisfies a performance obligation.

Testing Services Revenue

Our testing services revenue is derived from AlloSure Kidney, AlloMap Heart, AlloSure Heart and AlloSure Lung tests, which represented 78% of our total revenue for each of the three months ended March 31, 2026, and 73% of our total revenue for the three months ended March 31, 2025. Our testing services revenue depends on a number of factors, including (i) the number of tests performed; (ii) establishment of coverage policies by third-party insurers and government payers; (iii) our ability to collect from payers with whom we do not have positive coverage determination, which often requires that we pursue a case-by-case appeals process; (iv) our ability to recognize revenues on tests billed prior to the establishment of reimbursement policies, contracts or payment histories; and (v) how quickly we can successfully commercialize new product offerings.

Product Revenue

Our product revenue is derived primarily from sales of AlloSeq Tx, Olerup SSP and QTYPE products. Product revenue represented 9% of our total revenue for the three months ended March 31, 2026, and 13% of our total revenue for the three months ended March 31, 2025. We recognize product revenue from the sale of products to end-users, distributors and strategic partners when all revenue recognition criteria are satisfied. We generally have a contract or a purchase order from a customer

28

Table of Contents

with the specified required terms of order, including the number of products ordered. Transaction prices are determinable and products are delivered and risk of loss passed to the customer upon either shipping or delivery, as per the terms of the agreement. There are no further performance obligations related to a contract and revenue is recognized at the point of delivery consistent with the terms of the contract or purchase order.

Patient and Digital Solutions Revenue

Our patient and digital solutions revenue is mainly derived from sales of our Ottr software, XynQAPI, MedActionPlan, mTilda (HLA Data Systems), TransChart and Tx Access licenses, services and SaaS agreements across the digital portfolio, as well as our pharmacy sales at The Transplant Pharmacy, or TTP. Patient and digital solutions revenue represented 14% of our total revenue for the three months ended March 31, 2026, and 14% of our total revenue for the three months ended March 31, 2025.

Factors Affecting Our Performance

The Number of AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare and AlloSure Lung Tests We Receive and Report

The growth of our testing services is tied to the number of AlloSure Kidney, AlloMap Heart and AlloSure Heart, HeartCare and AlloSure Lung patient samples we receive and patient results we report. We incur costs in connection with collecting and shipping all samples and a portion of the costs when we cannot ultimately issue a report. As a result, the number of patient samples received largely correlates directly to the number of patient results reported.

Continued Growth of Patient and Digital Sales

The growth of our patient and digital revenues is tied to the continued successful implementation of our pharmacy solutions, Ottr, MedActionPlan and XynQAPI software businesses, as well as continued support and maintenance of existing pharmacy, MedActionPlan, Ottr and XynManagement customers. The Ottr software, TransChart, Tx Access and XynQAPI are currently implemented in multiple locations in the United States. The Ottr software implementation and XynQAPI implementation and support teams are based in Omaha, Nebraska. In addition, patient solutions offered by TTP in Flowood, Mississippi include hospital-affiliated pharmacies located on-site at the transplant center and specialty pharmacies that provide transplant-specific care and dispensing services. Additionally, with HLA Data Systems, we are able to support HLA laboratories in managing their day-to-day workflow.

Development of Additional Services and Products

Our development pipeline includes other solutions to help clinicians and transplant centers make personalized treatment decisions throughout a transplant patient’s lifetime. We expect to invest in research and development in order to develop additional services and products. Our success in developing new services and products will be important in our efforts to grow our business by expanding our potential market opportunity and diversifying our sources of revenue.

Timing of Research and Development Expenses

Our spending on research and development may vary substantially from quarter to quarter. We conduct clinical studies to validate our new products, as well as ongoing clinical and outcome studies to further the published evidence to support our commercialized tests. Spending on research and development for both experiments and studies may vary significantly by quarter depending on the timing of these various expenses.

29

Table of Contents

Results of Operations

Comparison of the Three Months Ended March 31, 2026 and 2025

(In thousands)

Three Months Ended March 31,

2026

2025

Change

Change (%)

Revenue:

Testing services revenue

$

91,398 

$

61,921 

$

29,477 

48 

%

Product revenue

10,346 

10,810 

(464)

(4)

%

Patient and digital solutions revenue

15,956 

11,954 

4,002 

33 

%

Total revenue

117,700 

84,685 

33,015 

39 

%

Operating expenses:

Cost of testing services

17,097 

15,113 

1,984 

13 

%

Cost of product

4,834 

5,586 

(752)

(13)

%

Cost of patient and digital solutions

11,698 

7,716 

3,982 

52 

%

Research and development

21,416 

18,524 

2,892 

16 

%

Sales and marketing

30,373 

22,991 

7,382 

32 

%

General and administrative

30,484 

22,769 

7,715 

34 

%

Litigation settlement expense

600 

5,360 

(4,760)

(89)

%

Total operating expenses

116,502 

98,059 

18,443 

19 

%

Income (loss) from operations

1,198 

(13,374)

14,572 

(109)

%

Other income:

Interest income, net

1,909 

2,784 

(875)

(31)

%

Other (expense) income, net

(330)

295 

(625)

(212)

%

Total other income

1,579 

3,079 

(1,500)

(49)

%

Income (loss) before income taxes

2,777 

(10,295)

13,072 

(127)

%

Income tax benefit (expense)

32 

(58)

90 

(155)

%

Net income (loss)

$

2,809 

$

(10,353)

$

13,162 

(127)

%

Testing services revenue

Testing services revenue increased by $29.5 million, or 48%, for the three months ended March 31, 2026, compared to the same period in 2025. The increase was primarily driven by testing services volume growth of 17% as compared to the same period in 2025. The variance between revenue growth and volume growth was primarily driven by $17.7 million of increased net collections associated with tests performed and revenue recognized in prior periods under ASC 606, partially offset by a $3.4 million reduction in testing services revenue related to the recognition of refund reserves payable to third-party payors.

Product revenue

Product revenue decreased by $0.5 million, or 4%, for the three months ended March 31, 2026, compared to the same period in 2025. The decrease was primarily due to lower sales of our commercial NGS-based kitted solutions.

Patient and digital solutions revenue

Patient and digital solutions revenue increased by $4.0 million, or 33%, for the three months ended March 31, 2026, compared to the same period in 2025. The increase was primarily driven by higher pharmacy sales and growth in our digital solutions, particularly an expanded customer base from Ottr software.

Cost of testing services

Cost of testing services increased by $2.0 million, or 13%, for the three months ended March 31, 2026, compared to the same period in 2025. The increase was primarily attributed to higher testing services volume, partially offset by the continuous efficiency measures to lower laboratory expenses.

Cost of product

30

Table of Contents

Cost of product decreased by $0.8 million, or 13%, for the three months ended March 31, 2026, compared to the same period in 2025. The decrease was primarily due to lower sales and improved manufacturing efficiencies and lower costs resulting from favorable pricing terms negotiated with key manufacturers.

Cost of patient and digital solutions

Cost of patient and digital solutions increased by $4.0 million, or 52%, for the three months ended March 31, 2026, compared to the same period in 2025. The increase was primarily due to an increase in the cost of goods from our pha

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. This discussion contains certain forward-looking statements that involve risk and uncertainties. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those set forth under the Section entitled “Risk Factors” in Item 1A, and other documents we file with the SEC. Historical results are not necessarily indicative of future results.

A discussion regarding our financial condition and results of operations for fiscal 2025 compared to fiscal 2024 is presented under Results of Operations of this Form 10-K. Discussions regarding our financial condition and results of operations for fiscal 2024 compared to 2023 have been omitted from this Annual Report on Form 10-K, but can be found in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 28, 2025, which is available without charge on the SEC's website at www.sec.gov and on our investor relations website at caredx.com.

Overview

We are a precision medicine company dedicated to improving outcomes for transplant patients and advancing organ health. We deliver solutions designed to empower clinicians and improve patient outcomes. Our integrated solutions include non-invasive molecular testing for heart, kidney, and lung transplants; laboratory products; digital health technologies; and patient solutions that support care before and after transplant. CareDx is the leading provider of genomics-based information for transplant patients.

Our commercially available post-transplant testing services consist of AlloSure® Kidney, a donor-derived cell-free DNA, or dd-cfDNA, solution for kidney transplant patients, AlloMap® Heart, a gene expression profiling solution for heart transplant patients, AlloSure® Heart, a dd-cfDNA solution for heart transplant patients, HeartCare, the combined use of AlloMap Heart and AlloSure Heart, and AlloSure® Lung, a dd-cfDNA solution for lung transplant patients. We have initiated several clinical studies to generate data on our existing and planned future testing services. From time to time, we partner with pharma and biopharma companies to use our technology and tests, often in clinical trials, to identify or screen for patients that may be appropriate candidates for their products. We also offer high-quality products in the pre-transplant space that increase the chance of successful transplants by facilitating a better match between a donor and a recipient of stem cells and organs. We also provide digital transplant solutions and various offerings that help transplant centers with patient management, outcomes quality and operational support.

See Part I, Item 1 (Business) of this Annual Report on Form 10-K for further information about our business.

Fourth Quarter Business Highlights

•Revenue of $108 million, an increase of 25% year-over-year

•Testing services revenue of $78 million, an increase of 23% year-over-year, and testing services volume of approximately 53,000, an increase of 17% year-over-year

•Patient and digital solutions revenue of $16.8 million and product revenue of $13.3 million, representing year-over-year growth of 47% and 17%, respectively

•Average revenue per test of approximately $1,480 including approximately $5 million in prior period revenue

•Net loss of $4 million, compared to net income of $88 million for the fourth quarter of 2024

•Cash flow from operations of $21.4 million

•Share repurchases of $12 million during the quarter of 773,000 shares at an average price of $15.79 per share

Full Year 2025 Financial Highlights

•Revenue of $380 million, an increase of 14% year-over-year

•Testing services revenue of $275 million, an increase of 10% year-over-year, and testing services volume of approximately 200,000, an increase of 14% year-over-year

•Patient and digital solutions revenue of $57 million and product revenue of $48 million, representing year-over-year growth of 31% and 19%, respectively

•Net loss of $21 million

•Cash flow from operations of $42 million

•Cash, cash equivalents and marketable securities of approximately $200 million as of December 31, 2025

•Share repurchases of $88 million during the year of 5.8 million shares at an average price of $15.16 per share

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Factors Affecting Our Performance

The Number of AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare and AlloSure Lung Tests We Receive and Report

The growth of our testing services is tied to the number of AlloSure Kidney, AlloMap Heart and AlloSure Heart, HeartCare and AlloSure Lung patient samples we receive and patient results we report. We incur costs in connection with collecting and shipping all samples and a portion of the costs when we cannot ultimately issue a report. As a result, the number of patient samples received largely correlates directly to the number of patient results reported.

Continued Growth of Patient and Digital Sales

The growth of our patient and digital revenues is tied to the continued successful implementation of our pharmacy solutions, Ottr, MedActionPlan and XynQAPI software businesses, as well as continued support and maintenance of existing pharmacy, MedActionPlan, Ottr and XynManagement customers. The Ottr software, TransChart, Tx Access and XynQAPI are currently implemented in multiple locations in the United States. The Ottr software implementation and XynQAPI implementation and support teams are based in Omaha, Nebraska. In addition, patient solutions offered by TTP in Flowood, Mississippi include hospital-affiliated pharmacies located on-site at the transplant center and specialty pharmacies that provide transplant-specific care and dispensing services. Additionally, with of HLA Data Systems, we are able to support HLA laboratories in managing their day-to-day workflow.

Development of Additional Services and Products

Our development pipeline includes other solutions to help clinicians and transplant centers make personalized treatment decisions throughout a transplant patient’s lifetime. We expect to invest in research and development in order to develop additional services and products. Our success in developing new services and products will be important in our efforts to grow our business by expanding our potential market opportunity and diversifying our sources of revenue.

Timing of Research and Development Expenses

Our spending on research and development may vary substantially from quarter to quarter. We conduct clinical studies to validate our new products, as well as ongoing clinical and outcome studies to further the published evidence to support our commercialized tests. Spending on research and development for both experiments and studies may vary significantly by quarter depending on the timing of these various expenses.

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Results of Operations

Comparison of the Years Ended December 31, 2025 and 2024

(In thousands)

Year Ended December 31,

2025

2024

Change

Change %

Revenue:

Testing services revenue

$

274,495 

$

249,381 

$

25,114 

10 

%

Product revenue

48,377 

40,783 

7,594 

19 

%

Patient and digital solutions

56,933 

43,621 

13,312 

31 

%

Total revenue

379,805 

333,785 

46,020 

14 

%

Operating expenses:

Cost of testing services

62,045 

55,611 

6,434 

12 

%

Cost of product

22,953 

23,381 

(428)

(2)

%

Cost of patient and digital solutions

38,241 

30,704 

7,537 

25 

%

Research and development

71,429 

72,510 

(1,081)

(1)

%

Sales and marketing

102,643 

81,975 

20,668 

25 

%

General and administrative

107,565 

125,139 

(17,574)

(14)

%

Litigation expense

5,710 

(96,300)

102,010 

(106)

%

Total operating expenses

410,586 

293,020 

117,566 

40 

%

(Loss) income from operations

(30,781)

40,765 

(71,546)

(176)

%

Other income:

Interest income, net

9,174 

11,765 

(2,591)

(22)

%

Other income, net

524 

329 

195 

59 

%

Total other income

9,698 

12,094 

(2,396)

(20)

%

(Loss) income before income taxes

(21,083)

52,859 

(73,942)

(140)

%

Income tax expense

(271)

(310)

39 

(12)

%

Net (loss) income

$

(21,354)

$

52,549 

$

(73,903)

(141)

%

Testing services revenue

Testing services revenue increased by $25.1 million, or 10%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily driven by testing services volume growth of approximately 14% as compared to the year ended December 31, 2024. This increase was partially offset by an increase in the refunds reserve of $3.5 million, and a decrease of $7.8 million in collections during the year ended December 31, 2025, as compared to the year ended December 31, 2024, under ASC 606 related to specific tests performed in prior periods.

Product revenue

Product revenue increased by $7.6 million, or 19%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily due to higher sales of our commercial NGS-based kitted solutions resulting from growth in our existing business including conversions of targeted customers.

Patient and digital solutions revenue

Patient and digital solutions revenue increased by $13.3 million, or 31%, during the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily driven by higher pharmacy sales and growth in our digital solutions, particularly an expanded customer base from Ottr software.

Cost of testing services

Cost of testing services increased by $6.4 million, or 12%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily attributed to higher testing services volume, partially offset by the continuous efficiency measures to lower laboratory expenses.

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Cost of product

Cost of product decreased by $0.4 million, or 2%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The decrease was primarily due to certain cost reduction efforts offset by an increased sales of our commercial NGS-based kitted solutions.

Cost of patient and digital solutions

Cost of patient and digital solutions increased by $7.5 million, or 25%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily due to an increase in the cost of goods from our pharmacy business resulting from higher sales.

Research and development

Research and development expenses decreased by $1.1 million, or 1%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The decrease was primarily attributable to decreases of $4.7 million in clinical trial expenses, $2.0 million in consulting and licensing expense and $1.5 million in stock-based compensation expense, partially offset by increases of $5.5 million in personnel-related costs and $1.6 million in software-related expenses.

Sales and marketing

Sales and marketing expenses increased by $20.7 million, or 25%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The increase was primarily attributable to increases of $15.4 million in personnel-related costs, $4.5 million in marketing expenses, $3.2 million in consulting expenses and $0.5 million in travel expenses, partially offset by a decrease of $2.9 million in stock-based compensation expense.

General and administrative

General and administrative expenses decreased by $17.6 million, or 14%, for the year ended December 31, 2025, compared to the year ended December 31, 2024. The decrease was primarily attributable to decreases of $25.7 million in stock-based compensation expense and $2.4 million in legal and consulting expenses, partially offset by increases of $3.7 million in software-related costs, $2.9 million in personnel-related costs, $2.3 million in a one-time impairment charge related to an intangible asset and associated construction in progress, $1.0 million in equipment related expenses and $0.6 million in travel expenses.

Litigation expense

The change in litigation settlement expense was mainly due reversal of litigation expense in 2024 related to the favorable outcome of patent infringement claims filed by Natera against us where the District Court ruled that the patents asserted against us were invalid, which was partially offset by settlement of the Securities Class Action lawsuit during 2025. See Note 8, Commitments and Contingencies, to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K under the caption “Litigation and Indemnification Obligations”, which is incorporated herein by reference.

Interest income, net

Interest income, net, decreased by $2.6 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to a decrease in cash, cash equivalents, and marketable securities.

Other income, net

Other income, net increased by $0.2 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to an increase in foreign exchange gains.

Income tax expense

For the year ended December 31, 2025, we recorded an income tax expense of $0.3 million on a loss before income taxes of $21.1 million. The effective tax rate for year ended December 31, 2025 differs from the federal statutory tax rate mainly due to the change in unrecognized tax benefits, non-deductible executive compensation and stock-based compensation.

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Liquidity and Capital Resources

We have incurred significant losses and negative cash flows from operations and had an accumulated deficit of $735.4 million at December 31, 2025. As of December 31, 2025, we had cash, cash equivalents and marketable securities of $201.4 million, and no debt outstanding.

We believe our existing cash balance and expected cash from existing operations, including cash from current license agreements and future license and collaboration agreements, or a combination of these, will be sufficient to meet our anticipated cash requirements for the next 12 months.

Shelf Registration Statement

On May 10, 2023, we filed a universal shelf registration statement (File No. 333-271814), or the Registration Statement, and we thereafter filed post-effective amendments on May 9, 2024 and May 23, 2024. The SEC declared the Registration Statement effective on May 23, 2024, and as a result, we can sell from time to time up to $250.0 million of shares of our common stock, preferred stock, debt securities, warrants, units or rights comprised of any combination of these securities, for our own account in one or more offerings under the Registration Statement. The terms of any offering under the Registration Statement will be established at the time of such offering and will be described in a prospectus supplement to the Registration Statement filed with the SEC prior to the completion of any such offering.

Stock Repurchase Programs

On February 20, 2025, our Board of Directors approved the February 2025 Repurchase Program, whereby we were authorized to purchase up to $50.0 million in shares of our common stock over a period of up to two years, commencing on February 20, 2025, through open market purchases, one or more Rule 10b5-1 trading plans, block trades and in privately negotiated transactions. During the three months ended June 30, 2025, we repurchased an aggregate of 3.0 million shares of our common stock under the February 2025 Repurchase Program for an aggregate purchase price of $50.0 million.

Following the completion of the February 2025 Repurchase Program, on May 30, 2025, our Board of Directors authorized a new share repurchase program of up to $50.0 million in shares of our common stock over a period of up to two years, commencing on May 30, 2025, or the May 2025 Repurchase Program. The May 2025 Repurchase Program may be carried out, subject to approval by a committee of our Board of Directors, through open market purchases, one or more Rule 10b5-1 trading plans, block trades and in privately negotiated transactions. During the year ended December 31, 2025, we purchased an aggregate of 2.8 million shares of our common stock under the May 2025 Repurchase Program for an aggregate purchase price of $37.8 million. As of December 31, 2025, $12.2 million was available for future share repurchases under the May 2025 Repurchase Program.

During the year ended December 31, 2025, we purchased an aggregate of 5.8 million shares of our common stock under the February 2025 and May 2025 Repurchase Programs, for a total purchase price of $87.8 million.

Cash Flows

The following table summarizes our cash flows for the years ended December 31, 2025, 2024 and 2023:

Year Ended December 31,

2025

2024

2023

(in thousands)

Net cash provided by (used in):

Operating activities

$

42,032 

$

38,048 

$

(18,388)

Investing activities

2,158 

(483)

40,446 

Financing activities

(93,394)

(5,606)

(29,606)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(90)

532 

(112)

Net (decrease) increase in cash, cash equivalents and restricted cash

$

(49,294)

$

32,491 

$

(7,660)

Cash Flows from Operating Activities

Net cash provided by (used in) operating activities consists of net income (loss), adjusted for certain noncash items in the consolidated statements of operations and changes in operating assets and liabilities.

Net cash provided by operating activities for the year ended December 31, 2025 was $42.0 million. Net operating assets increased by $3.8 million. Our noncash items included $34.9 million in stock-based compensation expense, $15.0 million of depreciation and amortization expense, $5.4 million of amortization of right-of-use assets, $2.3 million of impairment of

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intangible asset and associated construction in progress, $1.3 million of amortization of premium on marketable securities, net, and revaluation of contingent consideration to estimated fair value of $0.7 million.

Net cash provided by operating activities for the year ended December 31, 2024 was $38.0 million. Net operating assets decreased by $102.3 million. Our noncash items included $66.4 million in stock-based compensation expense, $14.2 million of depreciation and amortization expense, $5.6 million of amortization of right-of-use assets, $0.6 million of amortization of premium on marketable securities and revaluation of contingent consideration to estimated fair value of $0.9 million.

Cash Flows from Investing Activities

For the year ended December 31, 2025, net cash provided by investing activities was $2.2 million and primarily related to maturities of marketable securities of $154.7 million, partially offset by purchase of marketable securities of $145.9 million, additions of capital expenditures of $5.9 million and $0.7 million related to acquisition of an intangible asset.

For the year ended December 31, 2024, net cash used in investing activities was $0.5 million and primarily related to purchase of marketable securities of $160.3 million, additions of capital expenditures of $6.5 million and purchase of corporate equity securities of $0.6 million, offset by maturities of marketable securities of $166.9 million.

Cash Flows from Financing Activities

Net cash used in financing activities for the year ended December 31, 2025 was $93.4 million and primarily related to repurchase and retirement of common stock of $87.8 million, taxes paid related to net share settlements of restricted stock units of $12.1 million and payments of contingent consideration of $1.5 million. These payments were partially offset by the proceeds from exercises of stock options of $5.7 million and proceeds from issuances of shares of common stock under our employee stock purchase plan of $2.3 million.

Net cash used in financing activities for the year ended December 31, 2024 was $5.6 million and primarily related to repurchase and retirement of common stock of $0.5 million, taxes paid related to net share settlements of restricted stock units of $10.1 million and payments of contingent consideration of $5.3 million. These payments were partially offset by the proceeds from exercises of stock options of $8.9 million and proceeds from issuances of shares of common stock under our employee stock purchase plan of $1.4 million.

For a discussion regarding our cash flows for the year ended December 31, 2023, please refer to the discussion under the heading “Results of Operations—Liquidity and Capital Resources” in Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 28, 2025.

Contractual Obligations

For a discussion regarding our significant contractual obligations as of December 31, 2025 and the effect those obligations are expected to have on our liquidity and cash flows in future periods, refer to Note 8, Commitments and Contingencies, of the consolidated financial statements, and “Results of Operations—Liquidity and Capital Resources”, respectively, included elsewhere in this Annual Report on Form 10-K.

Foreign Operations

The accompanying consolidated balance sheets contain certain recorded assets in foreign countries, namely Stockholm, Sweden, and Fremantle, Australia. Although these countries are considered economically stable and we have experienced no notable burden from foreign exchange transactions, export duties, government regulations, or unanticipated events in foreign countries could have a material adverse effect on our operations.

Critical Accounting Policies and Significant Judgments and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported revenue generated and expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Our significant accounting policies are described in Note 2, Summary of Significant Accounting Policies, of the consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information. Some of these

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accounting policies require us to make difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. We believe that the following critical accounting policies reflect the more significant estimates and assumptions used in the preparation of our consolidated financial statements.

Revenue Recognition

We recognize revenue from testing services, product sales and patient and digital solutions revenue in the amount that reflects the consideration which it expects to be entitled in exchange for goods or services as it transfers control to its customers. Revenue is recorded considering a five-step revenue recognition model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations and recognizing revenue when, or as, an entity satisfies a performance obligation.

Testing Services Revenue

AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare and AlloSure Lung patient tests are ordered by healthcare providers. We receive a test requisition form with payer information along with a collected patient blood sample. We consider the patient to be our customer and the test requisition form to be the contract. Testing services are performed in our laboratory. Testing services represent one performance obligation in a contract and are performed when results of the test are provided to the healthcare provider, at a point in time.

The healthcare providers that order the tests and on whose behalf we provide testing services are generally not responsible for the payment of these services. The first criterion, identify the contract(s) with a customer, and the second criterion, identify the performance obligations in the contract, of revenue recognition are satisfied when we receive a test requisition form with payer information from the healthcare provider. Generally, we bill third-party payers upon delivery of an AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare or AlloSure Lung test result to the healthcare provider. Amounts received may vary amongst payers based on coverage practices and policies of the payer. 

We have used the portfolio approach, a practical expedient under Accounting Standards Codification, or ASC, Topic 606, Revenue from Contracts with Customers, to identify financial classes of payers. Revenue recognized for Medicare and other contracted payers is based on the agreed current reimbursement rate per test, adjusted for historical collection trends where applicable. We estimate revenue for non-contracted payers and self-payers using transaction prices determined for each financial class of payers using history of reimbursements. This includes analysis of an average reimbursement per test and a percentage of tests reimbursed. This estimate requires significant judgment.

We monitor revenue estimates at each reporting period based on actual cash collections in order to assess whether a revision to the estimate is required. Changes in transaction price estimates are updated quarterly based on actual cash collected or changes made to contracted rates, our discussions with payers, and other pertinent information. In addition, consistent with ASC 606-10-25-1, we continue to assess whether it is probable that we will collect substantially all of the consideration to which we will be entitled when determining if a contract with a customer exists.

Refunds Reserve

With respect to revenue recognized related to testing services whereby consideration is expected to be received from third-party payers, we recognized a constraint to the estimated variable consideration such that it is not probable that a significant revenue reversal will occur. When assessing the total consideration expected to be received from third-party payers, a certain percentage of revenues is further constrained for estimated refunds.

Certain refunds were recognized in accrued liabilities until they are either paid to the respective third-party payers or it is determined the refund will not ultimately be paid, at which time the related accrual is reduced with a corresponding increase to testing services revenue. During the year ended December 31, 2025, the refunds reserve to third-party payers were recognized and testing services revenue decreased by $3.5 million for amounts we estimated that would be refunded to third-party payers.

Product Revenue

Product revenue is recognized from the sale of products to end-users, distributors and strategic partners when all revenue recognition criteria are satisfied. We generally have a contract or a purchase order from a customer with the specified required terms of order, including the number of products ordered. Transaction prices are determinable in the contract. The products are delivered and risk of loss passed to the customer upon either shipping or delivery, as per the terms of the agreement. There are no further performance obligation related to a contract and revenue is recognized at the point of shipment or delivery consistent with the terms of the contract or purchase order.

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Patient and Digital Solutions Revenue

Patient and digital solutions revenue is primarily derived from software as a service, or SaaS, agreements entered into with various transplant centers, which are our customers for this class of revenue. Digital revenue in connection with software license agreements is recognized at the point in time when control of the license is transferred and made available for the customer's use and benefit. The PCS is recognized ratably over the term of the arrangement beginning on the date when access to the subscription is made available to the customer in accordance with ASC 606.

Software license agreements typically require advance payments from customers upon the achievement of certain milestones. We record deferred revenue in relation to these agreements when cash payments are received for which the related revenues have not been recognized because one or more of the revenue recognition criteria have not been met, and generally recognize revenue over the contractual term, as performance obligations are fulfilled.

In addition, we derive patient revenue from medication sales. The medication sales revenue is recognized based on the negotiated contract price with the governmental, commercial and non-commercial payers with any applicable patient co-pay. Based on the individual agreement, we recognize revenue from medication sales when prescriptions are shipped or delivered.

Stock-based Compensation

We use the Black-Scholes Model, which requires the use of estimates such as stock price volatility and expected option lives, to value employee stock options. We estimate the expected option lives using historical data, estimate volatility using our own historical stock prices, estimate risk-free rates using the implied yield currently available in the U.S. Treasury zero-coupon issues with a remaining term equal to the expected option lives, and estimate dividend yield using our expectations and historical data. Compensation expense for stock options issued to nonemployees is calculated using the Black-Scholes Model and is recorded over the service performance period using the straight-line attribution method. Options subject to vesting are required to be periodically remeasured over their service performance period, which is generally the same as the vesting period. The fair value of each restricted stock unit is calculated based upon the closing price of our common stock on the date of the grant.

Our stock-based compensation arrangements vest over a three to four year vesting schedule. We expense our stock-based compensation under the ratable method, which treats each vesting tranche as if it were an individual grant. Compensation expense is recognized on awards ultimately expected to vest and reduced for forfeitures that are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Forfeitures are estimated based on our historical experience.

Business Combinations

We determine and allocate the purchase price of an acquired business to the assets acquired and liabilities assumed based on their estimated fair values as of the business combination date, including separately identifiable intangible assets, which are separable from goodwill. We base the estimated fair value of identifiable intangible assets acquired in a business combination on independent valuations that use information and assumptions provided by management, which consider management’s best estimates of inputs and assumptions that a market participant would use. We allocate any excess purchase price over the estimated fair value assigned to the net tangible and identifiable intangible assets acquired and liabilities assumed to goodwill. The use of alternative valuation assumptions, including estimated revenue projections, growth rates, royalty rates, cash flows, discount rates, estimated useful lives and probabilities surrounding the achievement of contingent milestones could result in different purchase price allocations and amortization expense in current and future periods.

In those circumstances where an acquisition involves a contingent consideration arrangement that meets the definition of a liability under Accounting Standard Codification, or ASC, Topic 480, Distinguishing Liabilities from Equity, we recognize a liability equal to the fair value of the contingent payments that we expect to make as of the acquisition date. We remeasure this liability each reporting period and record changes in the fair value as a component of operating expenses.

Transaction costs associated with acquisitions are expensed as incurred in general and administrative expenses. Results of operations and cash flows of acquired companies are included in our operating results from the date of acquisition.

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Acquired Intangible Assets

Amortizable intangible assets include customer relationships, developed technology, commercialization rights, trademarks and trade names and in-process technology assets acquired as part of a business combination or asset acquisition. Intangible assets subject to amortization are amortized over their estimated useful lives. Acquired in-process technology assets and a favorable license agreement are considered to be indefinite-lived until the completion or abandonment of the associated research and development efforts. If and when development is complete, which generally occurs if and when regulatory approval to market a product is obtained, the associated assets would be deemed finite-lived and would then be amortized based on their respective estimated useful lives at that point in time.

Impairment of Goodwill, Intangible Assets and Long-lived Assets

Goodwill

Goodwill recorded in a business combination is not subject to amortization. Instead, it is tested for impairment on an annual basis and whenever events or changes in circumstances indicate its carrying amount may not be recoverable. We have a single reporting unit and consequently evaluate goodwill for impairment based on an evaluation of the fair value of our company as a whole.

Our annual impairment test date is December 1st. During the goodwill impairment review, we assess qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than the carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and the market considerations, and our overall financial performance. If, after assessing the totality of these qualitative factors, we determine that it is not more likely than not that the fair value of the reporting unit is less than the carrying amount, then no additional assessment is deemed necessary. Otherwise, we proceed to compare the estimated fair value of the reporting unit with the carrying value, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, we record an impairment loss based on the difference.

When necessary, to determine the reporting unit’s fair value under the quantitative approach, we use a combination of income and market approaches, such as estimated discounted future cash flows of that reporting unit, multiples of earnings or revenues, and analysis of recent sales or offerings of comparable entities. We also consider our market capitalization on the date of the analysis to ensure the reasonableness of the reporting unit’s fair value.

In connection with our annual goodwill assessment on December 1, 2025, we performed a qualitative assessment taking into consideration past, current and projected future earnings, recent trends and market conditions, and our market capitalization. Based on this analysis, we concluded that it was more likely than not that the fair value of the reporting unit exceeded its carrying amount. As such, it was not necessary to perform the quantitative goodwill impairment assessment at that time. As of December 31, 2025, no impairment of goodwill has been identified.

Intangible assets not subject to amortization

We evaluate the carrying value of intangible assets not subject to amortization, related to acquired in-process technology assets and a favorable license agreement.

During the period the assets are considered indefinite-lived, they are tested for impairment on an annual basis, as well as between annual tests if we become aware of any events occurring or changes in circumstances that would indicate that the fair values of the acquired in-process technology assets are less than their carrying amounts. An impairment loss would be recorded when the fair value of an acquired in-process technology asset is less than its carrying value. If and when development is complete, which generally occurs when the products are made commercially available, the associated acquired in-process technology asset will be deemed finite-lived and will then be amortized based on its estimated useful life.

As of December 31, 2025, no impairment of acquired in-process technology assets has been identified.

Intangible assets and long-lived assets subject to amortization

We evaluate our finite-lived intangible assets and our long-lived assets for indicators of possible impairment when events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. We then compare the carrying amounts of an asset group with the future net undiscounted cash flows expected to be generated by such asset group. If an impairment exists, we measure the impairment based on the excess carrying value of the asset group over the asset group’s fair value determined using discounted estimates of future cash flows. Intangible assets subject to amortization are carried at cost less accumulated amortization. Amortization expenses are recorded to cost of testing services, cost of product, cost of patient and digital solutions, research and development expenses and sales and marketing expenses in the consolidated statements of operations.

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Recently Issued Accounting Standards

Refer to Note 2, Summary of Significant Accounting Policies - Recent Accounting Pronouncements, to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K for a description of recently issued accounting pronouncements, including the expected dates of adoption and estimated effects on our results of operations, financial position and cash flows.

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