MDxHealth (MDXH) Q2 FY26 earnings call: guidance and Q&A

Inquired if the Q2 sequential increase in tissue-based tests indicated that prior challenges were internal (sales force restructuring) rather than competitive, given competitors' growth.

Management confirmed that the challenges were internal, stemming from sales force restructuring and territory reorganization in Q4 and Q1. They expect Q2 to signal a return to full sales force focus on their core menu, with no disruption to market position.

“I kind of signaled we expected Q4 and Q1 to be a little choppy, really a function of the restructuring of the sales organization, right? We had a territory reorganization and then cross-training of the new reps, remapping of the customer base of the combined businesses, and that's really what we saw.”

asked by Thomas Flaten · answered by Michael McGarrity

Asked if revenue progression from H1 to H2 FY26 would be linear or subject to fluctuations between Q3 and Q4.

Management expects generally linear progression, noting that Q3 can be a "wildcard" due to seasonality in patient and clinician flow, but anticipates acceleration in both Q3 and Q4.

“Yes, Thomas, I would say generally linear, Q3 is always a little bit of a wildcard with some seasonality just based on patients and clinician flow through our urology customer base. So that being the only potential factor to affect Q3, we would expect acceleration in Q3 and Q4 in linear-ish.”

asked by Thomas Flaten · answered by Michael McGarrity

Sought confirmation on the elimination of the $10.4 million Novitas contingent liability following the closure of the Plano lab, and if this was discussed as a possibility in Q1.

Management confirmed the successful elimination of the liability, stating it was a significant de-risking element. They had anticipated this outcome but needed to ensure all legal and financial structures were tight before communicating it.

“Yes, Dan, thanks. I didn't want to get ahead of that. There was obviously a lot of work to occur with all of our outside counsels and advisers on setting that up and consent from our our lending partner, but it came together as we anticipated. We believe the structure, the way we set that entity up allowed for that.”

asked by Daniel Brennan · answered by Michael McGarrity

Asked about the impact of the $20 million capital raise on future capital needs, considering the debt and Exact payments, and the role of internally generated cash flow.

Management emphasized that anticipated top-line growth and operating discipline would generate meaningful progress towards self-funding. The recent capital raise provides significant runway, and they expect business growth to fund obligations, with flexibility demonstrated with partners.

“So we're confident that, that gives us pretty strong leverage as we go forward. This capital, our balance sheet position, obviously provides significant runway for the business. And we've demonstrated, I think, with our partner, Exact, Abbott, flexibility on that.”

asked by Daniel Brennan · answered by Michael McGarrity

Questioned why tissue business wasn't growing faster year-over-year despite sales force recovery, given a competitor's growth and potential weakness in the low-risk segment.

Management acknowledged the flat year-over-year comparison, noting Q2 FY25 was a high comp. They highlighted the sales team's dual focus in Q2 FY26 (recovery + Resolve customer transition) and stated that current guidance implies a return to year-over-year growth for tissue. They also clarified that growth is driven by both market conversion (urologists not using biomarkers) and market share gains, particularly in the active surveillance population.

“But our guidance as it's set up requires a return to year-over-year growth that we were seeing prior to this. Our current guide at $110 million to $115 million contemplates 20% to 26% growth, which would suggest that if you look at our 2026 for tissue by quarters, we'd be down 12%, flat and then up, accelerated, up, accelerated.”

asked by William Bonello · answered by Michael McGarrity

Asked about the company's approach to inorganic growth and potential tuck-in acquisitions, given past activities and recent capital raise.

Management stated they are very confident in their current market opportunity to support growth but are always looking for growth opportunities. They emphasized a disciplined approach to M&A, noting that MDxHealth is now an "obvious first stop" for partners seeking access to the urology vertical. Near-term focus remains on executing current opportunities and clearing the "setback" from Resolve.

“I would say that, that's flipped significantly where I think -- and please take this the right way. It's not meant to be self-serving, but anybody who's looking for partner or opportunity or channel or infrastructure into the urology vertical, we're an obvious first stop.”

asked by Mark Massaro · answered by Michael McGarrity