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    VCYT
    Earnings call· Mar 2026(Q1 FY26)

    VERACYTE Q1 FY26 earnings call VCYT

    May 5, 2026 Source

    Executive summary

    Veracyte Q1 FY26 — Strong Revenue and Volume Growth, Exceeding Profitability Expectations

    Veracyte delivered a strong start to the year, exceeding profitability expectations with robust double-digit revenue and volume growth driven by its core Decipher and Afirma franchises. The company is approaching an inflection point with the upcoming midyear launch of Prosigna LDT and the end-of-Q2 launch of TrueMRD in muscle-invasive bladder cancer, which are expected to expand its addressable market and drive future growth. Strategic investments in leadership and organizational capabilities are underway to support this next phase of expansion.

    Highlights

    5

    • Total revenue reached $139.1 million, representing 21% year-over-year growth.

    • Total volume increased to approximately 47,600 tests, up 17% compared to the prior year.

    • Decipher volume grew 24% year-over-year to approximately 28,000 tests, with nearly 30% growth in high-risk categories.

    • Adjusted EBITDA was $42.8 million, or 30.8% of revenue, marking a 73% year-over-year increase.

    • Generated $35.2 million of cash from operations, ending the quarter with $439.1 million in cash, cash equivalents, and short-term investments.

    Concerns

    1

    • Seasonality of Afirma no result rate

    Guidance & targets

    7
    CategoryTargetConfidence
    Full-year total revenue
    $582 million to $592 million
    high materiality
    High
    Full-year total revenue growth
    13% to 14% year-over-year growth
    high materiality
    High
    Full-year testing revenue growth (excluding new tests)
    16% to 18%
    medium materiality
    High
    Full-year Decipher revenue growth
    approximately 20%
    medium materiality
    High
    Full-year Afirma revenue growth
    high single-digit to low double-digit range
    medium materiality
    High
    Full-year adjusted EBITDA
    greater than 26%
    high materiality
    High
    Full-year Afirma no result rate contribution to volume growth
    2% to 3%
    low materiality
    Medium

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Decipher
    Consistent growth driven by expansion in ordering providers and orders per physician, reflecting its differentiated position and inclusion in NCCN guidelines. Strong traction in advanced disease, with significant growth in high-risk categories. Continued evidence generation supports its role across the prostate cancer spectrum.
    Volume: 28,000 testsVolume growth YoY: 24%Ordering providers: expandedOrders per physician: expandedHigh-risk categories growth: nearly 30%Patients in low-risk setting since launch: >80,000
    		—30%——
    Afirma
    Solid demand and strong execution on operational initiatives, particularly the V2 transcriptome workflow transition, which enhanced the ability to deliver definitive results and improved the no result rate. Expanding clinical evidence and demonstrated real-world impact support sustained healthy growth.
    Volume: 17,200 testsVolume growth YoY: 12%No result rate: improved sequentially and year-over-yearNo result rate impact on volume growth: 400 bpsNew account wins: healthyUtilization: increasedOrdering providers: high number
    		—21%——

    Operational metrics

    16
    Total revenue
    $139.1M21% YoY growth
    Q1 FY26

    Total revenue for the first quarter.

    Total volume
    47,600 tests17% YoY growth
    Q1 FY26

    Total test volume for the first quarter.

    Testing revenue
    $135.1M26% YoY increase
    Q1 FY26

    Testing revenue for the first quarter.

    Total testing volume
    45,200 tests19% YoY growth
    Q1 FY26

    Total testing volume for the first quarter.

    Testing ASP
    $2,9866% YoY increase
    Q1 FY26

    Average selling price for testing, including prior period collections.

    Normalized Testing ASP (ex-PTCs)
    $2,9003% YoY increase
    Q1 FY26

    Average selling price for testing, excluding prior period collections.

    Non-GAAP gross margin
    75.7%350 bps YoY increase
    Q1 FY26

    Non-GAAP gross margin for the first quarter.

    Testing gross margin
    76.4%230 bps YoY increase
    Q1 FY26

    Testing gross margin for the first quarter.

    Non-GAAP operating expenses
    $64.6M7% YoY increase
    Q1 FY26

    Non-GAAP operating expenses for the first quarter.

    R&D expense
    $24.1M$8.5M YoY increase
    Q1 FY26

    R&D expense for the first quarter, reflecting reclassification of certain IT expenses.

    Sales and marketing expense
    $24.7M$2.2M YoY increase
    Q1 FY26

    Sales and marketing expense for the first quarter.

    G&A expense
    $15.8M$6.6M YoY decrease
    Q1 FY26

    G&A expense for the first quarter, primarily due to reclassification of certain IT expenses to R&D.

    Adjusted EBITDA
    $42.8M73% YoY increase
    Q1 FY26

    Adjusted EBITDA for the first quarter, exceeding long-term target of 25%.

    Cash, cash equivalents and short-term investments
    $439.1M
    Q1 FY26

    Balance of cash, cash equivalents and short-term investments at the end of the first quarter.

    Prosigna addressable market
    225,000 patients
    annually

    Estimated annual addressable market for Prosigna LDT in the U.S.

    Decipher prostate cancer penetration
    1 in 3 men
    current

    Current penetration of Decipher in prostate cancer patients in the U.S.

    Industry KPIs

    5
    MetricValueDetails
    Launch access metrics225,000 patientspatients
    Pipeline read out calendarMultiple trials
    Therapeutic drug market shareTop
    Clinical trial efficacy safety dataPositive outcome expected
    Cumulative patients uptake since launch>80,000 patientspatients

    Product announcements

    2
    ProductTypeDetails
    Prosigna LDTlaunch
    TrueMRDlaunch

    Risks & headwinds

    1
    Seasonality of Afirma no result ratesummer months

    No result rate tends to spike over the summer months

    Mitigation: Considered in full-year guidance assumption of 2-3% contribution to volume growth, lower than Q1's 400 bps.

    What to watch in Q2 FY26

    5

    Prosigna LDT launch and OPTIMA readout

    Q2/Q3 FY26
    CurrentOn track for midyear launch; OPTIMA results presentation confirmed for ASCO in June.
    TargetPositive OPTIMA results (non-inferiority) and successful commercial launch.

    Why it matters

    A positive readout and successful launch are critical for Prosigna to become a multi-year growth driver and expand Veracyte's addressable market in breast cancer.

    We remain on track to commercially launch Prosigna LDT by midyear. ... I'm pleased to share that this presentation has now been confirmed on the agenda for ASCO later this month.

    Q&A highlights

    6

    What is the ceiling for the Afirma no result rate improvement from the V2 transcriptome, and how will it impact top and bottom line in future quarters?

    The 400 basis points contribution to Q1 volume growth is likely the peak. For the full year, a 2-3% contribution is expected, lower than Q1 due to typical summer RNA degradation and a tougher prior-year comparable. The improvement significantly benefits patients and physicians by providing more actionable results.

    “During the quarter, it was a 400-basis point good guide to volume growth. And so, I do think that's about as good as it's going to get. ... for the full year, we're now expecting a 2% to 3% good guide from no result rate.”

    asked by Puneet Souda · answered by Rebecca Chambers

    2 min read6 chapters

    Detailed Narrative

    01

    Q1 Performance and Strategic Inflection Point

    Veracyte achieved a strong start to 2026 with total revenue of $139.1 million, up 21% year-over-year, and total volume of approximately 47,600 tests, a 17% increase. The company exceeded profitability expectations, delivering $42.8 million in adjusted EBITDA, representing 30.8% of revenue. Management highlighted that the company is approaching an inflection point with two significant product launches, Prosigna LDT and TrueMRD, expected to expand its addressable market and drive future growth.

    02

    Decipher Franchise Momentum and Evidence Expansion

    The Decipher franchise continued its consistent growth, delivering approximately 28,000 tests, a 24% year-over-year volume increase. Strong traction was observed in advanced disease, with nearly 30% growth across high-risk categories. The evidence pipeline is robust, with four Phase III trials (including GUIDANCE and PREDICT-RT) evaluating Decipher Prostate completing enrollment. The company is also incorporating additional predictive biomarkers and advancing digital pathology and AI-powered analysis using its extensive Decipher database of over 350,000 digitized slides.

    03

    Afirma Operational Improvements and Clinical Impact

    Afirma delivered approximately 17,200 tests, reflecting 12% year-over-year volume growth. This was significantly boosted by the successful transition to the V2 transcriptome workflow, which improved the no result rate and contributed approximately 400 basis points to Q1 volume growth. A recent independent study analyzing Medicare data from 2016 to 2023 found that increased Afirma adoption was associated with a meaningful reduction in thyroid surgery rates, underscoring its clinical and economic impact.

    04

    Prosigna LDT Launch and OPTIMA Trial

    Veracyte is on track to commercially launch Prosigna LDT by midyear, targeting approximately 225,000 early-stage breast cancer patients annually. The launch is supported by the upcoming presentation of results from the large Phase III OPTIMA trial (approximately 4,500 patients) at ASCO in June. Management believes positive results could be practice-changing and further strengthen Prosigna's clinical foundation, with aggressive launch plans contingent on favorable data.

    05

    TrueMRD Platform Expansion into Minimal Residual Disease

    The company remains on track to launch TrueMRD in muscle-invasive bladder cancer (MIBC) by the end of the second quarter, leveraging the Decipher brand and established urology channels. The TrueMRD platform, based on whole-genome sequencing, is highly scalable with a growing pipeline of over 10 studies in testing/analysis, 12 in contracting, and 29 in active planning across various cancer types. External validation was highlighted at AACR, with data from trials like TOMBOLA, UMBRELLA, and NEOBLAST presented.

    06

    Strategic Investments in Leadership and Capabilities

    To support its next phase of growth, Veracyte is investing in leadership and organizational capabilities. The company welcomed Dr. Kevin Haas as Chief Development and Technology Officer and Tracy Ward as Chief Human Resources Officer. These appointments are aimed at enhancing product innovation, development, and scaling the organization to support the expanding product roadmap and global reach.

    AI-generated summary of the company’s earnings call. Not investment advice.