Exagen (XGN) Q3 Earnings call transcript Nov 12, 2024
2min read Exagen Inc. recently held an earnings call, providing insights into its strategic plans and financial performance for the third quarter of 2024. The call, led by President and CEO John Aballi and CFO Jeff Black, highlighted the company's progress in executing its strategic plan, focusing on profitable growth and delivering on its operational and financial targets.
Financial Performance and Outlook
For the third quarter of 2024, Exagen reported a total revenue of $12.5 million, with $1.2 million in onetime adjustments impacting the figures. The company's trailing 12-month AVISE ASP improved for the seventh consecutive quarter, reaching $404 per CTD test. The adjusted EBITDA loss for the quarter was approximately $4 million, and the company is on track to deliver a 30% improvement for the full year.
Looking at the financial performance, Exagen has demonstrated a significant improvement in its financial health. Compared to the same period in 2022, the company has grown revenue by nearly 30%, expanded ASP by 45%, improved gross margins by over 1,300 basis points, reduced operating expenses by almost 20%, and improved adjusted EBITDA loss by over 70%. These achievements are a testament to the company's focus on operational efficiency and strategic investments in its core business.
Product Launches and Market Opportunities
The call also highlighted Exagen's upcoming product launches, which are expected to deliver significant near-term profitable growth. The company is set to launch new proprietary markers through its AVISE CTD platform, with the first enhancements available by year-end. These new markers are expected to deliver valuable insights to clinicians, further enhancing the platform's capabilities and positioning Exagen for future success.
Strategic Initiatives and Challenges
Exagen's strategic initiatives are centered around delivering profitable growth, optimizing its AVISE CTD platform, and expanding its market reach. The company is also focused on managing costs and improving operational efficiency, with an eye towards achieving overall cash flow positivity by the end of next year.
However, the company faces challenges, including regulatory approvals for new products and market competition. The recent hurricane impacted Exagen's testing volume, with approximately 50% of testing volume lost in Florida for 2.5 weeks at the end of Q3 and into Q4. The company is closely monitoring the situation and working with clinics to mitigate the impact.
Investor Perspective
Investors and analysts on the call showed interest in Exagen's financial performance, product launches, and market opportunities. They asked questions about the company's financial outlook, the impact of onetime adjustments, and the potential of new product launches. The company's management provided detailed insights into these topics, demonstrating a clear understanding of the market dynamics and strategic initiatives.
Conclusion
Exagen's earnings call provided a comprehensive update on its financial performance, strategic initiatives, and product launches. The company's focus on delivering profitable growth, optimizing its platform, and managing costs positions it well for the future. The upcoming product launches and regulatory approvals will be key drivers of growth, and investors will be closely watching Exagen's progress towards cash flow positivity. Overall, the call underscored Exagen's commitment to innovation, operational efficiency, and market expansion, making it an interesting player to watch in the diagnostic testing industry.