What drove PSNL's earnings growth in 2024?

Personalis, Inc. (NASDAQ:PSNL) experienced a net income growth from the previous year, with a net income of -$81.28 million for 2024Q4, compared to the cumulative net income of -$81.28 million for the same period in 2023. Despite the negative net income, the company's operating revenue increased from $19.53 million in Q1 2024 to $25.71 million in Q3 2024, with the highest revenue of $25.71 million in Q3 2024. The net profit margin also improved from -66.42% in Q1 2024 to -61.2% in Q2 2024, and further to -95.64% in Q3 2024, before decreasing to -96.06% in Q4 2024.

The key factors contributing to Personalis' earnings growth in 2024 include:

1. **Revenue Growth**: The company's operating revenue increased significantly, particularly in the second and third quarters, with a year-over-year growth of 35% in Q2 2024 and 17.24% better than estimated revenue in Q2 2024. This was driven by a 117% year-over-year surge in revenue from their biopharma testing and services, as well as an 8% year-over-year increase in revenue from their enterprise customer segment.
2. **Cost Management**: Personalis managed to improve its net profit margin from -66.42% in Q1 2024 to -61.2% in Q2 2024, and further to -95.64% in Q3 2024, before decreasing to -96.06% in Q4 2024. This indicates that the company's cost management efforts were effective in controlling losses despite the negative net income.
3. **Investor Confidence**: The company's strong performance and strategic initiatives, such as securing a $7.5 million VA task order, likely contributed to investor confidence and potential earnings growth.

In conclusion, Personalis' earnings growth in 2024 was driven by revenue growth, particularly in their biopharma testing and services, and effective cost management, despite a decrease in net profit margin in the fourth quarter.