BillionToOne’s Prenatal Revenue, True-Up Guidance, and Oncology Growth Claims Don’t Match in Q2 Earnings Call

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Date of Call: Aug 5, 2026

Financials Results

• Revenue: $109.4 million, up 64% year-over-year
• EPS: $0.15 per diluted share, compared to a net loss in the prior year
• Gross Margin: 70.5%, up 5 percentage points year-over-year
• Operating Margin: 5%, compared to 16% operating margin in the first quarter of 2026

Guidance:

• Reiterated 2026 total revenue outlook of $450 million to $465 million, representing growth of approximately 48% to 52% compared to full year 2025.
• Expect to operate the business to continue generating profitability similar to current levels, even with significant continued investments.

Business Commentary:

Revenue and Test Volume Growth:

• Billion to One reported total revenue of $109.4 million for Q2 2026, up 64% year-over-year, with test volume increasing 35% year-over-year to approximately 196,000 tests.
• The growth was driven by strong commercial execution, rising average selling prices (ASPs), and an increase in both prenatal and oncology test volumes.

Oncology Segment Expansion:

• Oncology revenue grew 176% year-over-year to $13.7 million, with the introduction of new products like North Star Origin and updates to existing assays.
• The expansion is attributed to the rapid scaling of oncology tests, new clinical evidence supporting North Star response, and the signing of a lease for a dedicated oncology production lab.

Gross Margin and Profitability:

• The company maintained a strong gross margin of 70.5% in Q2, expanding 5 percentage points year-over-year, and achieved a 5% operating margin and a 15% adjusted EBITDA margin.
• This was supported by higher ASPs, operational discipline, and continuous improvements to reduce costs of goods sold (COGS) per test, particularly in oncology.

Prenatal Product Developments:

• The prenatal segment saw a 56% increase in revenue to $95.8 million, driven by the strong adoption of new products like Unity Confirm and the expansion of the Unity Fetal Risk Screen to 130 genes.
• These developments are aimed at enhancing the company's position in the prenatal market and increasing its serviceable market size.

Strategic Hiring and Market Positioning:

• The company accelerated hiring, adding approximately 70 sales representatives in the first half of the year, ahead of its plan.
• This strategic move is to capitalize on growth opportunities, penetrate more health systems, and support long-term growth in prenatal and oncology segments.

Sentiment Analysis:

Overall Tone: Positive

• Management described Q2 performance as 'strong across all pillars, as we delivered another quarter with high growth, excellent margins, and positive operating income and cash flow.' They noted 'rapid growth continued with test volume up 35% year-over-year and revenue up 64% year-over-year' and maintained 'superior gross margin profile, which was 70.5% in the quarter.' The tone was confident regarding future growth drivers and competitive positioning.

Q&A:

• Question from Mark Massaro (BTIG): Obviously, it looks like the true-up number dropped by approximately 6 million or so in Q2. relative to Q1. I just wanted to check if X true-ups, just double-checking that your prenatal test revenue would have increased sequentially. Is that correct?
  Response: Confirmed that prenatal test revenue increased sequentially, driven by higher test volumes and ASPs.

• Question from Mark Massaro (BTIG): Can you just speak to what you might be seeing in the competitive market? And then related to that, my last question, you did accelerate hiring of sales reps, it sounds like, relative to your plan. I'm just curious if any of those stepped-up hires might have something to do with the competitive environment.
  Response: Hiring was driven by the company's own growth opportunities and pipeline, not directly by the competitive environment, but by the need to capitalize on anticipated future growth factors like health system adoption and new product launches.

• Question from Dan Arras (Stiefel): Can you maybe just put some additional color to the trend sequentially in oncology if you strip out the ASP dynamic? To what degree was quarterly volume different?
  Response: Oncology test volumes grew sequentially ahead of expectations, with ASPs stable quarter-over-quarter. Trajectory is strong, with growth expected to continue.

• Question from Ricky (Guggenheim): So while it's still early in the launch, do you think that [Unity Confirm's 50% adoption] is already starting to drive share gains in NIPT?
  Response: Unity Confirm is opening doors to new health systems and reducing test splitting, viewed as a long-term driver for growth and share gains, especially as other adoption factors align.

• Question from Ricky (Guggenheim): And you also announced the expanded 130 gene risk screen panel. Just wondering if there's any change to how you're thinking about the economics per test there, either in terms of reimbursement or the COGS?
  Response: No significant change in economics expected for the 130-gene panel; it is a competitive advantage that will help attract health systems preferring large panels.

• Question from Noah Kava (Jefferies): What percentage of your patient base do you think is relevant for potential attach [for North Star Origin] here? And how are you assuming that the economics play out here over the next couple of quarters?
  Response: North Star Origin is not expected to change product economics significantly but will drive incremental adoption, especially in community oncology settings where uncertain diagnoses are more common.

• Question from Noah Kava (Jefferies): One of your competitors noted incremental payer friction in prenatal testing, more so in the carrier screening side of things. Curious if there's anything you can comment on there, if you're seeing any friction there.
  Response: No payer friction observed, attributed to the company's use of PLA codes for billing, avoiding issues faced by competitors with bundled or stacked billing.

• Question from David Westenberg (Piper Sandler): If you look year over year, it looks like the same. I'm just kind of curious. You know, I know [you] report seasonality in q2... do you think you might have additional seasonality in q2 in non-3dnl testing...
  Response: Acknowledged that seasonality exists (fewer tests in Q2 from existing accounts due to fewer pregnancies), but it is a relatively small effect not modeled, and the company performed ahead of plan despite it.

• Question from David Westenberg (Piper Sandler): And then I just want to talk about the disclosed claims of $10 million, I think, pending in Q2 Network by national payers that you suppressed up your true ups. Can you help us bridge this? Once those specific claims are processed, how does that $10 million flow through...
  Response: The $10 million in held claims has some embedded in realized revenue; full upside is uncertain until claims are processed, and guidance is maintained conservatively without assuming true-ups in the back half.

• Question from Casey Woodring (JP Morgan): You talked a lot about launching on Epic Aura in the quarter... Is there a scenario where you can be fully integrated by the time we enter 2027? And... you talked about a meaningful impact next year, maybe like any way to quantify...
  Response: Fully integrated with Epic Aura, but individual health system onboarding takes time (2-4 weeks per system). Impact is difficult to quantify but expected to be meaningful as health systems are onboarded, with test volumes per system ranging from 1,000 to 3,000 per quarter.

• Question from Casey Woodring (JP Morgan): And then maybe just one on the gross margin profile. You know, you did 70 and a half percent here. You know, how should we think about that progression once response, you know, is reimbursed?...
  Response: Expect to maintain gross margin above 70% long-term by balancing growth with ASP increases and COGS reductions, even as oncology mix increases. An unexpected acceleration could temporarily push margins below 70%.

Contradiction Point 1

Quantification of Prenatal Revenue Growth

Specific dollar figure for growth provided in one quarter, vague estimate in another.

Mark Massaro (BTIG) - Mark Massaro (BTIG)

2026Q2: Confirmed prenatal revenue excluding true-ups was up more than a couple million dollars sequentially, citing a chart (slide 14) for estimates but not providing specifics. - Ross Taylor(CFO)

Did prenatal test revenue increase sequentially excluding true-ups following the ~$6M drop in true-up revenue in Q2? - Mark Massaro (BTIG)

2026Q2: A specific sequential dollar increase was approximately $4.5 million, representing about 5% growth. - Oguzhan Atay(CEO)

Contradiction Point 2

Modeling of True-up Revenue in H2 Guidance

Clear statement of excluding true-up revenue in guidance contradicted by an implication it might be included.

David Westenberg (Piper Sandler) - David Westenberg (Piper Sandler)

2026Q2: Confirmed no true-up revenue is modeled in H2 guidance. - Ross Taylor(CFO)

How will the $10M of held claims in Q2 flow through once processed, and are you modeling any true-up revenue in H2 guidance? - David Westenberg (Piper Sandler)

2026Q2: The full upside is uncertain due to timing/payment uncertainty, so guidance remains conservative until clarity. - Ozan Atay(CEO) [Implies guidance may be updated if clarity is achieved, contrasting with the explicit exclusion statement]

Contradiction Point 3

True-up Revenue Modeling for Future Quarters

Guidance assumptions for true-up revenue change between quarters.

David Westenberg (Piper Sandler) - David Westenberg (Piper Sandler)

2026Q2: Confirmed no true-up revenue is modeled in H2 guidance. - Ross Taylor(CFO)

How do the $10M held claims in Q2 flow through once processed, and are any true-up revenues modeled in H2 guidance? - Brandon Couillard (Wells Fargo Securities, LLC)

2026Q1: True-up revenue is only embedded for Q1... no true-ups are assumed for later quarters. - Ross Taylor(CFO)

Contradiction Point 4

Oncology Volume Growth Trajectory and Expectations

The expected sequential growth pattern for oncology volume shifts between quarters.

Dan Arras (Stiefel) - Dan Arras (Stiefel)

2026Q2: Confirmed strong momentum from Q2 to Q3. Q3 to Q4 can be trickier due to shorter accessioning days... - Ozan Atay(CEO)

Okay, let's see. The user wants me to rewrite the input into one concise earnings-call question. The input is: "Should we model sequentially increasing oncology volumes each quarter in H2 (Q2 to Q3 and Q3 to Q4)?" First, I need to make sure I understand the original question. The person is asking whether they should model oncology volumes increasing each quarter in the second half of the year, specifically from Q2 to Q3 and Q3 to Q4. The key points here are the sequential increase, the quarters involved (H2, which is Q3 and Q4, but the input mentions Q2 to Q3 and Q3 to Q4, which might be a typo since H2 is Q3 and Q4). Wait, H2 is the second half of the year, so that would be Q3 and Q4. But the input says Q2 to Q3 and Q3 to Q4. That might be a mistake because Q2 is part of H1. Maybe the user meant H2 as Q3 and Q4, but the transition from Q2 to Q3 is H1 to H2. Hmm, but the original input includes both Q2 to Q3 and Q3 to Q4. That's a bit confusing. Maybe they want to model increases in Q3 and Q4, each quarter sequentially.The task is to make this into a concise question. The original is already a question, but maybe it's a bit wordy. Let me try to rephrase it. The main elements are: modeling, sequentially increasing oncology volumes, each quarter in H2 (which might be Q3 and Q4), but the original mentions Q2 to Q3 and Q3 to Q4. Wait, H2 is Q3 and Q4. So perhaps the user is considering the transition from Q2 (end of H1) to Q3 (start of H2) and then Q3 to Q4. But H2 is Q3 and Q4. So maybe the question is whether to model increasing volumes in each quarter of H2, which would be Q3 and Q4. But the original input mentions Q2 to Q3 and Q3 to Q4. That might be an error. Alternatively, maybe they're considering H2 as Q2 to Q4, but that's not standard. Typically, H2 is Q3 and Q4.Assuming that the user intended H2 as Q3 and Q4, but the input mentions Q2 to Q3 and Q3 to Q4, perhaps there's a mistake. However, I need to stick to the input as given. The user's instruction says if the input is too vague or lacks info, output as-is. But here, maybe the input is correct. The question is whether to model sequentially increasing oncology volumes each quarter in H2, which is Q3 and Q4, but the input specifies Q2 to Q3 and Q3 to Q4. Wait, Q2 is part of H1. So maybe the user is considering the transition from H1 to H2 and within H2. But the question is about H2. So perhaps the original question is a bit conflicting. However, I need to work with what's given.The goal is to make it concise. The original question is already a question. Let's see if we can make it more concise. The phrase "sequentially increasing oncology volumes each quarter in H2 (Q2 to Q3 and Q3 to Q4)" can be simplified. Since H2 is Q3 and Q4, but the input includes Q2 to Q3, which is part of H1. Maybe that's a mistake. But assuming the user intended to include both Q2 to Q3 and Q3 to Q4, perhaps the correct approach is to mention the quarters explicitly. Alternatively, maybe the user meant H2 as Q3 and Q4, and wants to model increasing volumes in each quarter of H2, i.e., from Q3 to Q4. But the original input says "sequentially increasing each quarter in H2 (Q2 to Q3 and Q3 to Q4)". That seems conflicting because Q2 is not part of H2. Maybe it's a typo and should be Q3 to Q4. But the user wrote Q2 to Q3 and Q3 to Q4. So perhaps they are considering the transition from Q2 (end of H1) to Q3 (start of H2) and then within H2 from Q3 to Q4. So the model would have increases in both those transitions. In that case, the question is whether to model sequentially increasing oncology volumes in each quarter transition during H2, which includes Q2 to Q3 and Q3 to Q4. But H2 is Q3 and Q4, so Q2 is part of H1. Maybe the user is considering the entire period from Q2 to Q4 - Daniel Arias (Stifel, Nicolaus & Company, Incorporated)

2026Q1: For cadence: Q2 and Q3 should see sequential growth, but Q4 is seasonally slower due to holidays. - Ross Taylor(CFO)

Contradiction Point 5

Gross Margin Sustainability and Forecast

The stated ability to sustain high gross margins appears inconsistent.

Casey Woodring (JP Morgan) - Casey Woodring (JP Morgan)

2026Q2: The goal is to maintain gross margins above 70%... Unexpectedly rapid oncology growth could temporarily push margins below 70%... - Ozan Atay(CEO)

What is the expected impact on gross margin after North Star Response is reimbursed? - Daniel Arias (Stifel, Nicolaus & Company, Incorporated)

2026Q1: The company expects 70%+ gross margin to be sustained for the calendar year... - Ross Taylor(CFO)

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