vcyt-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-36156

VERACYTE, INC.

(Exact name of registrant as specified in its charter)

Delaware

20-5455398

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

6000 Shoreline Court, Suite 300

South San Francisco, California 94080

(Address of principal executive offices, zip code)

(650) 243-6300

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value, $0.001 per share

VCYT

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐

No x

As of May 3, 2024, there were 76,448,070 shares of common stock, par value $0.001 per share, outstanding.

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VERACYTE, INC.

INDEX


						Page No.
PART I. — FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)						1
Condensed Consolidated Balance Sheets as of March 3 1 , 202 4 and December 31, 202 3						1
Condensed Consolidated Statements of Operations for the Three Month Periods Ended March 3 1 , 202 4 and 20 23						2
Condensed Consolidated Statements of Comprehensive Loss for the Three Month Periods Ended Mar ch 3 1 , 202 4 and 202 3						3
Condensed Consolidated Statements of Stockholders' Equity for the Three Month Periods Ended March 3 1 , 202 4 and 202 3						4
Condensed Consolidated Statements of Cash Flows for the Three Month Periods Ended March 3 1 , 2023 and 202 3						5
Notes to Condensed Consolidated Financial Statements						6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations						18
Item 3. Quantitative and Qualitative Disclosures About Market Risk						29
Item 4. Controls and Procedures						29
PART II. — OTHER INFORMATION
Item 1A. Risk Factors						31
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds						68
Item 3. Defaults Upon Senior Securities						68
Item 4. Mine Safety Disclosures						68
Item 5. Other Information						69
Item 6. Exhibits						69
SIGNATURES						71

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VERACYTE, INC.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements concerning our business strategy and plans, future operating results and financial position, as well as our objectives and expectations for our future operations, are forward-looking statements.

In some cases, you can identify forward-looking statements by such terminology as “believe,” “may,” “will,” “potentially,” “estimate,” “continue,” “anticipate,” “intend,” “could,” “would,” “project,” “plan,” “expect” and similar expressions that convey uncertainty of future events or outcomes, although not all forward-looking statements contain these words. Forward-looking statements include, but are not limited to, statements about:

•the factors that may impact our financial results;

•our expectations regarding total revenue and total test volume;

•our expectations with respect to our future research and development, general and administrative and selling and marketing expenses and our anticipated uses of our funds;

•our expectations with respect to the impact of inflation, rising interest rates and foreign exchange fluctuations, as well as regional conflicts globally, energy and supply chain disruptions, and the resulting market volatility on our business;

•our beliefs with respect to the optimization of our processes for the analysis of ribonucleic acid, or RNA, samples;

•our beliefs with respect to importance of maintaining libraries of clinical evidence;

•our expectations regarding the Percepta Nasal Swab classifier for early lung cancer detection;

•our expectations regarding the addition of minimal residual detection capabilities to our diagnostic platform;

•our expectations regarding the timing and success of our transition to offering more of our tests as in vitro diagnostic tests on multiple platforms worldwide;

•our ability to continue to receive quality reagents and other raw materials from certain single source suppliers;

•our ability to successfully integrate C2i Genomics, Inc., or C2i, HalioDx and Decipher Biosciences into our business and our ability to deploy the nCounter Analysis System successfully and run our tests on this and other platforms worldwide;

•our expectations regarding our partnerships and agreements;

•our expectations regarding capital expenditures, our anticipated cash needs and our estimates regarding our capital requirements and profitability;

•our business strategy and our ability to execute on our strategy;

•our ability to obtain and maintain Medicare, other government payer, and other commercial third party payer reimbursement at acceptable levels and our expectations regarding the timing of reimbursement;

•our expectations with regard to the estimated number of patients eligible for our tests and the attributes and potential benefits of our tests and any future tests we may develop to patients, physicians, and payers;

•our expectations on our ability to drive demand for and reimbursement of our tests; our sales, marketing and distribution capabilities and strategy;

•our intellectual property position;

•the impact of government laws and regulations, policies, guidance agency interpretations and judicial decisions; and

•our beliefs in our competitive position.

We caution you that the foregoing list does not contain all of the forward-looking statements made in this report. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, prospects, and financial needs. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to a number of risks, uncertainties and assumptions described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ

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materially from those projected in the forward-looking statements. We disclaim any intention or obligation to publicly update or revise any forward-looking statements for any reason or to conform such statements to actual results or revised expectations, except as required by law.

iii

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PART I. — FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements-(Unaudited)

VERACYTE, INC.

Condensed Consolidated Balance Sheets

(unaudited)

(In thousands, except share and par value amounts)


	March 31, 2024		December 31, 2023
			(See Note 1)
Assets
Current assets:
Cash and cash equivalents	$	209,188	$	216,454

Accounts receivable	46,665		40,378
Supplies and inventory	18,328		16,128
Prepaid expenses and other current assets	16,237		12,661
Total current assets	290,418		285,621
Property, plant and equipment, net	21,566		20,584
Right-of-use assets, operating leases	11,167		10,277
Intangible assets, net	116,348		88,593
Goodwill	753,853		702,984
Restricted cash	1,082		876
Other assets	5,639		5,971
Total assets	$	1,200,073	$	1,114,906
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	12,152	$	12,943
Accrued liabilities	30,293

SEC Form 10-Q filed by Veracyte Inc.