GRAIL, Inc. Q3 FY2025 earnings call

• Commercial progress: Gallery volumes and revenue in 2025 grew 39% and 29% respectively, with ~420,000 tests sold by over 16,000 providers.
• International expansion: Strategic collaboration with Samsung to bring Gallery to Asian markets, $110 million equity investment from Samsung, and commercial launch in Canada with MedCan.
• Clinical program updates: PATHFINDER II results shared at ESMO, SIMPLIFY data updated at EDCC, registrational clinical program for Gallery including NHS Gallery trial.
• Financials: Q3 revenue $36.2M, up 26% y-o-y; net loss $89M, improvement of 29% y-o-y; non-GAAP adjusted gross profit $20M, up 60% y-o-y; cash position $547.1M, updated cash burn guidance to no more than $290M for 2025.

The main product segment is Gallery. Revenue for the third quarter was $36.2 million, with $32.8 million from screening revenue and $3.4 million from development service revenue. U.S. Gallery revenue was $32.6 million, up 28% compared to the third quarter of 2024. Growth in Gallery volumes and revenue in 2025 were 39% and 29% respectively. Approximately 420,000 Gallery commercial tests had been sold by more than 16,000 healthcare providers from the launch of Gallery through September 30.

• Refined 2025 U.S. Gallery revenue growth to mid-range of 20%-30%.
• Cash burn guidance for 2025 updated to no more than $290M, extending cash runway into 2030.
• FDA PMA timeline moved to Q1 2026 due to increased confidence in timing.

Risks related to actual results differing from projections, as outlined in SEC filings, including risks from competition and regulatory uncertainties.

Q: The FDA timeline is moved to Q1 instead of 2026. What changed?

A: The main thing is tightening the confidence intervals around the time frame, with more confidence in being able to put out for the first quarter.

Q: You are currently running a promotion on your website, offering $150 off of Gallery for getting tested from October to year-end. What incentivized you to offer this promotion? How has the demand elasticity in response to this promotion been? And are you piloting a reduction to $800 moving forward? Could this impact ASPs moving forward?

A: Discounting has been a component of increasing breadth and depth of prescribing, driven by provider channel growth, integrations with companies like Quest and Athena, and repeat testing.

Q: You have bolstered the balance sheet nicely with the Samsung investment. How do you plan to use the additional capital, and specifically, how does the commercial strategy change, especially in light of recent or upcoming competition?

A: More flexibility on the balance sheet to flex commercial investments, maintaining momentum with customers.

Q: Hims and Hers made an investment in the company recently. Conjecture that means GRAIL is going to take a direct-to-consumer approach to Gallery. Comment on those plans or the potential to take that route over time.

A: Committed to the PMA pathway, but recognizing the digital health channel for broad access while continuing push towards PMA.

Q: Starting on NHS England, looking back to May 2024 when the statement was issued saying that early results were not compelling enough to justify a large-scale pilot. Were they referring to any clinical utility data from year one or to test level performance metrics such as PPV sensitivity and or specificity? Can you share a little bit more on what prompted that decision?

A: NHS wanted very exceptional data; only NHS evaluation team saw year one data, final data to be released mid-2026.

Q: On the SIMPLIFY study, does this were these patients, I guess, that went under, you know, typical protocols? Why were these, you know, cancers, I guess, kind of missed in follow-up?

A: Patients presenting with nonspecific symptoms, primary care physicians may not work up further, but CSO prediction would have provided directional investigation in most cases.

Q: Cost of screening revenue, in dollar terms, it was down $3 million relative to Q2. Sequentially on a per test basis. How are you getting there and the durability and the trajectory from here?

A: Fixed cost leverage from higher sample volumes on the updated platform, demonstrating benefits of volume growth for cost management.