NEO

Strategic Position & Core Business Focus

• NeoGenomics holds 25% market share in hematology diagnostics, leveraging this leadership position to expand into large underpenetrated solid tumor therapy selection and measurable residual disease (MRD) testing markets via its Pantracer product family and RadarST assay.
• The company's core strategic priority is driving durable, profitable growth via mix shift to higher-value NGS testing, expanding new product traction, and improving margins.

New Product & Pipeline Progress

• Early commercial traction for Pantracer and RadarST is in line with expectations, with 30% of RadarST orders including additional NeoGenomics tests. A third RadarST indication has been submitted for Medicare reimbursement via MolDx, joining two prior pending submissions; approval of all five targeted indications would grant access to over 40% of the total addressable market for tumor-informed MRD testing.
• A new FDA-approved PTEN immunohistochemistry companion diagnostic for prostate cancer was launched, marking entry into urologic oncology, and can be offered as a standalone test or as part of Pantracer Pro.
• Next-generation whole genome sequencing MRD assay remains on track: data generation is expected in 2027, with a potential clinical launch in 2029. A new low sample input AML MRD flow assay is in development for improved sensitivity and faster turnaround across multiple blood cancers.

Commercial & Operational Updates

• The commercial organization was reorganized into two dedicated ecosystems (oncology and pathology) to sharpen accountability and execution, as the company has reached sufficient scale to support separate sales motions. The commercial team is on track to exceed 160 total commercial representatives in Q3 2026.
• Initial Epic EHR integrations are complete, with revenue and adoption benefits expected to begin in 2027. Net promoter score remains in the high 70s for both oncology and pathology customer segments.
• The Lab of the Future initiative (automation, digital pathology, platform upgrades, footprint optimization) continues to drive margin improvements: two dry labs were closed, low-margin non-oncology business acquired with Pathline was exited, and Pantracer LBX was successfully transitioned to the NovaSeq X platform, which improves throughput, turnaround time, and per-test costs as volume scales.

Financial Discipline

• Operating expense discipline was maintained in the quarter: total adjusted operating expenses fell 3% year-over-year. Increases in sales and marketing (+13%) and R&D (+19%) spending were more than offset by an $8 million decline in general and administrative (G&A) expenses.

• Full year 2026 total revenue guidance was raised to $802 million to $806 million, up from the prior range of $797 million to $803 million.
• Full year 2026 clinical business growth guidance is maintained at low-teens, with NGS revenue growth guidance raised to mid-20s from the prior low-20s estimate.
• 2026 non-clinical business revenue is now expected to decline high-single digits year-over-year, revised down from the prior guidance of a low-to-mid-single digit decline.
• Revenue growth cadence for the second half of 2026 is projected at ~10% in Q3 (up from 9%-10% prior guidance) and above 10% in Q4 2026.
• Full year 2026 gross margin is expected to improve 100 to 150 basis points year-over-year.
• Full year 2026 adjusted EBITDA guidance was raised to $56 million to $58 million, from the prior range of $55 million to $57 million, representing over 30% year-over-year growth at the midpoint. Adjusted EBITDA growth is projected to be low-30s year-over-year in both Q3 and Q4 2026.
• G&A as a percentage of revenue is targeted to fall to the low 30% range in 2026, and below 30% in 2027, down from ~38% in 2025.

Total company revenue for Q2 2026 was $201.7 million, an 11% increase year-over-year.

• Clinical Segment: Revenue grew 14% year-over-year; NGS revenue (which makes up 33% of total clinical revenue) grew 26% year-over-year, with 14% volume growth. Post-2023 launched NGS products now account for 26% of total clinical revenue and grew over 30% year-over-year. NGS large panels grew over 20% in the quarter. Average unit price (AUP) for the overall clinical segment grew 12% year-over-year, while total test volume grew 2%.
• Non-Clinical Segment: Total revenue was $14.5 million, a 15% decline year-over-year, and contributes ~5% of total company revenue. Pharma revenue (the core of the non-clinical segment) declined 26% year-over-year, while the oncology data solutions (ODS) sub-segment grew 17% year-over-year, which only partially offset pharma weakness.

Gross margin results: Adjusted gross margin was 48.1%, an expansion of 260 basis points year-over-year, for an adjusted gross profit of $96.9 million (up 18% year-over-year). Adjusted EBITDA was $14.4 million, up 36% year-over-year.

• Pharma segment revenue weakness has persisted longer than expected, with lower-than-anticipated pull-through from 2025 bookings leading to full-year downward revisions for the non-clinical segment.
• RadarST revenue growth is dependent on successful MolDx and commercial payer reimbursement approvals, with uncertain timing and outcome for pending submissions.
• Prior authorization regulatory changes are being monitored, but management currently does not expect a material impact to the business in 2027.
• The company completed a $10 million settlement with the DOT for a legacy self-disclosed matter, which will impact Q3 2026 operating cash flow (the amount was already reserved for in prior financial reporting).

Q: NGS growth hit 26% for the second straight quarter, with large expected upside from new MRD and liquid biopsy products. Is there conservatism in the updated mid-20s full-year NGS growth guidance, and how should we think about second half performance? / A: Management notes the 26% Q2 growth was split 14% from volume and 12% from AUP, with two-thirds of AUP growth coming from mix shift to higher-value panels. Large panels grew over 20%, and post-2023 launched NGS products grew 30%, so the strength is broad-based and durable. The guidance raise to mid-20s full-year growth reflects actual strong first-half performance, and MRD is already included in clinical revenue numbers.

Q: The non-clinical pharma segment is only ~5% of total revenue, has been under pressure, and is not a core reason investors hold the stock. How core is this business to NeoGenomics long-term? / A: The core of NeoGenomics is the clinical business, which drives all long-term growth and performance. Pharma services are opportunistic rather than strategically core, but they serve as an enabler for clinical R&D: they provide early access to cutting edge oncology drug development, allow for early testing and refinement of new in-house assays like whole genome sequencing MRD before they launch to the clinical market. The segment is not getting meaningful new investment, but management expects to return it to year-over-year growth in 2027.

Q: AUP growth was very strong in Q2, driven partially by mix shift. How sustainable is this AUP growth, and what should we expect for the mix of AUP vs volume growth through the end of 2026 and into 2027? / A: AUP growth has two durable components: mix shift to higher-value NGS testing, and ongoing revenue cycle management (RCM) improvements to secure better contractual pricing with managed care payers. There is still meaningful runway for both: ongoing shift from targeted panels to large CGP panels will continue for multiple years, and there are still pricing improvement opportunities across the company's 300+ existing payer contracts. AUP will lead clinical revenue growth in Q3 and Q4 2026, with low single-digit volume growth (held down by the lapping of an exited high-volume, low-value contract that peaked in Q3 2025). In 2027, volume growth will return to mid-single digits, and AUP growth will moderate slightly.

Q: What milestones should investors track for RadarST over the next 12 months, and how will G&A leverage offset planned investments in sales and R&D? / A: The two previously submitted RadarST indications are expected to get reimbursement decisions by the end of 2026, with the third submitted indication expected to get a decision in the second half of 2027. As approvals come through, the company will increase investment in the oncology sales team to drive uptake. For G&A leverage, management is targeting a steady decline in G&A as a percentage of revenue, falling to the low 30% in 2026 and below 30% in 2027, which frees up capital to reinvest in sales and R&D while still growing adjusted EBITDA. Additional operational efficiencies from the Lab of the Future initiative will also help drive further bottom line improvements into 2027.