GRAIL, Inc. Q2 FY2025 earnings call

Key Points

• Bob Ragusa discussed long-term investments in multi-cancer early detection, PATHFINDER 2 results set for ESMO 2025 presentation, commercial growth of Galleri with over 45,000 tests sold in Q2, and the 2025 Analyst Day in November.
• Joshua Ofman elaborated on clinical validation importance, Galleri's performance metrics (PPV, specificity, CSO accuracy), results from PATHFINDER 2 and NHS Galleri trials showing improved PPV and consistent specificity/CSO accuracy, and the targeted methylation approach.
• Aaron Freidin reported financials: revenue up 11% to $35.5M, net loss improved by 93% compared to Q2 2024, non-GAAP adjusted gross profit up slightly, and cash burn guidance updated to no more than $310M for 2025.

Revenue for the second quarter was $35.5 million, up $3.5 million or 11% compared to Q2 2024. Screening revenue was $34.4 million, and development services revenue was $1.1 million. More than 45,000 Galleri commercial tests were sold in Q2, and as of June 30, over 370,000 Galleri tests had been prescribed by over 15,000 healthcare providers since 2021. Galleri test orders continue to grow, with 25% of volume being repeat testing.

Forward-Looking Statements

• Cash burn for 2025 updated to no more than $310M, a decrease from 2024.
• Plan to submit detailed results from PATHFINDER 2 at ESMO 2025.
• PMA submission in the first half of 2026 and full clinical utility results from the 140,000 participant NHS Galleri study mid-2026.

Risks

• Issues with the new version of Galleri leading to increased turnaround times and higher reprocessing costs.
• Risks associated with forward-looking statements and potential differences between actual results and projected outcomes.

Q: Comment on 2Q free cash burn and dynamics impacting cash burn in the second half of 2025.

A: First 6 months had ~$160M burn; cash burn expected to come down in subsequent quarters driven by increased volumes and working through the new automated platform.

Q: Clarity on clinical utility data for PMA submission and PPV normalization in studies.

A: FDA focuses on clinical validation, not utility; PPV reported within study populations, with normalization for cancer incidents and case mix planned.

Q: Growth ramp with Everlywell and customer support infrastructure for PMA.

A: Anticipate Everlywell to drive growth via their subscriber base; ramping customer support in line with business growth, focusing on efficiency.

Q: International deployments and tech transfer for Galleri.

A: High inbound interest globally; NHS Galleri study results in mid-2026 will aid international discussions; tech transfer may be needed if international volume grows significantly.

Q: Quest integration impact and repeat test rates.

A: Quest integration led to ~7% of orders in Q2, with 500 healthcare professionals ordering via Quest; pleased with repeat test rate at 25%, aiming to continue driving higher repeat testing.