Exact Sciences Corporation Q4 FY2024 earnings call

• Highlights in 2024 included delivering over 4.6 million results, core revenue growth 11%, non-GAAP operating expenses up 2%, EBITDA up 48%, free cash flow more than doubled, FDA approval and Medicare pricing for Cologuard Plus, completing studies for Oncodetect, generating evidence for liquid biopsy and multi-cancer screening, and being recognized as a great place to work for the sixth consecutive year.
• In 2025, they plan to increase adoption of current tests and launch three new tests, leveraging scale, reach, and ExactNexus technology platform to power leadership in cancer diagnostics, improve customer experience, and reinvest in growth and innovation.

In the fourth quarter, screening revenue was $553 million, growing 14%. For the full year 2024, screening revenue was between $2.35 billion and $2.39 billion. Precision oncology revenue was $161 million in the fourth quarter, and for the full year 2024, it was between $675 million and $695 million. Core revenue grew 11% in 2024, adjusted EBITDA increased 52% to $75 million in Q4, and full-year adjusted EBITDA margin expanded nearly 300 basis points.

• Total revenue for Q1 2025 is expected to be between $680 million and $695 million, and full-year 2025 between $3.025 billion and $3.085 billion.
• Screening revenue Q1 2025 is between $520 million and $530 million, full-year 2025 between $2.35 billion and $2.39 billion.
• Precision oncology revenue Q1 2025 is between $160 million and $165 million, full-year 2025 between $675 million and $695 million.
• Adjusted EBITDA full-year 2025 is expected to be between $410 million and $440 million. Cologuard Plus launch in Q2, with impact on second half revenue, and margin expansion driven by volume leverage, Cologuard Plus pricing, and OpEx leverage.

• Potential impact from legal cases like Braidwood, which could affect coverage and cost sharing for screening tests.
• Competitive dynamics in the cancer diagnostics market that could impact market share and growth.
• Regulatory challenges affecting reimbursement and timely product launches for new tests.

Q: Catherine Schulte asked about Screening guidance and growth drivers.

A: Kevin and Aaron discussed rescreens, care gap programs, Cologuard Plus launch, and commercial execution, noting rescreens growing over 30% per year, care gap programs expanding, and Cologuard Plus launch in Q2 with impact on second half revenue.

Q: Doug Schenkel asked about 2025 being the most productive year and balancing product launches, Cologuard revenue growth, and SG&A.

A: Kevin and Aaron talked about resourcing for product launches, leverage in G&A, and modest impact from Cancerguard and MRD launches in 2025.

Q: Tycho Peterson probed on margin outlook and blood assay.

A: Aaron discussed margin expansion drivers, G&A optimization, and the blood assay on track for middle of summer with team working hard on it.

Q: Matt Sykes asked about commercial team changes for new launches.

A: Kevin discussed the resized field rep team, training on new products, and high excitement from the sales team heading into 2025.

Q: Dan Brennan asked about Cologuard Plus reimbursement and blood test comparison.

A: Kevin talked about Cologuard Plus reimbursement progress, high provider engagement, and blood test on track for middle of summer with focus on addressing colon cancer screening problem.

Q: Jack Meehan asked about colon blood test lockdown.

A: Kevin stated the CRC blood test is on track for middle of summer with team working hard, and no impact on volumes from competitive dynamics.

Q: Andrew Brackmann asked about Cologuard Plus reimbursement with Braidwood case.

A: Kevin discussed Cologuard Plus reimbursement progress, Medicare coverage, and payer receptivity driven by test performance.

Q: Patrick Donnelly asked about pipeline tests and revenue trajectory.

A: Kevin and Aaron talked about Cologuard Plus, MRD, and multi-cancer screening as key tests, with long-term double-digit growth potential.

Q: Vijay Kumar asked about MRD data and revenue ramp.

A: Brian Baranick discussed MRD study methodology, upcoming data sharing at ASCO, and strong market opportunity for MRD.

Q: Subu Nambi asked about MRD test performance.

A: Brian Baranick mentioned MRD study data under embargo, promising results, and ongoing clinical studies.

Q: Puneet Souda asked about Cologuard Plus pricing and Cancerguard pricing.

A: Aaron discussed Cologuard Plus pricing assumption and Cancerguard pricing to be addressed later.

Q: Dan Leonard asked about Screening guidance variance.

A: Kevin and Aaron talked about Screening guide, opportunities for execution, and guide aligning with consensus.

Q: Bill Bonello asked about rescreening and new screeners.

A: Aaron and Kevin discussed rescreen rate improvement, 2 million eligible patients, and care gap programs as a channel for new screeners.

Q: Unidentified Analyst asked about Screening growth contribution from rescreening and care gap.

A: Aaron stated rescreening and care gap contributions are still intact, with rescreening being a large growth opportunity.