NeoGenomics Reports Strong Q3 Results, Raises FY Guidance

NeoGenomics, Inc. (NASDAQ: NEO), a leading oncology testing services company, reported its third-quarter results for the period ended September 30, 2024, demonstrating strong financial performance and raising its full-year guidance. The company's revenue growth, improved gross profit margin, and significant increase in adjusted EBITDA reflect its strategic focus on advanced diagnostics and clinical services.

Revenue Growth and Segment Performance
NeoGenomics' consolidated revenue for the third quarter of 2024 increased by 10% year-over-year to $168 million. Clinical Services revenue, the company's primary growth driver, grew by 14% to $146 million. This growth was driven by a 9% increase in clinical test volume and a 5% increase in average revenue per clinical test ("revenue per test") to $463. The company's Advanced Diagnostics segment, however, saw a 10% decrease in revenue to $22 million, primarily due to international site closures, restructuring activities, and lower RaDaR® revenue.

Improved Gross Profit Margin and Adjusted EBITDA
NeoGenomics' consolidated gross profit for the third quarter of 2024 was $74.9 million, an increase of 20.2% compared to the same period in 2023. The company's adjusted gross profit margin, excluding amortization of acquired intangible assets and stock-based compensation expense, was 47.8%, up from 44.6% in the third quarter of 2023. This improvement was primarily due to an increase in revenue, partially offset by higher compensation and benefit costs.

The company's adjusted EBITDA for the third quarter of 2024 increased by 305% to positive $13 million compared to positive $3 million in the same period in 2023. This significant improvement was driven by revenue growth, improved gross profit margin, and cost control.



Revised Full-Year 2024 Guidance
NeoGenomics revised its full-year 2024 guidance, increasing its consolidated revenue guidance to $655 million to $667 million, representing an 11% to 13% year-over-year increase. The company also raised its adjusted EBITDA guidance to $37 million to $40 million, representing a 1133% to 1233% increase from the previous guidance of $3 million to $7 million.



In conclusion, NeoGenomics' strong third-quarter results and revised full-year guidance reflect the company's strategic focus on advanced diagnostics and clinical services. The company's revenue growth, improved gross profit margin, and significant increase in adjusted EBITDA demonstrate the success of its strategic initiatives. As the company continues to execute on its business plan, investors can expect NeoGenomics to maintain its positive momentum in the coming quarters.