GeneDx Holdings Corp.

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the GeneDx first quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question at that time, you'll need to press star 1-1 on your telephone keypad. Please be reminded that this conference call is being recorded. At this time, I'd like to introduce your host for today's presentation, Ms. Sabrina Dunbar of Investor Relations. Ma'am, please begin.

Thank you, Operator, and thank you to everyone for joining us today. On the call, we have Catherine Stulen, President and Chief Executive Officer, and Kevin Feely, Chief Financial Officer. Earlier today, GDX released financial results for the first quarter ended March 21st, 2026. Before we begin, please take note of our cautionary statement. We may make forward-looking statements on today's call, including about our business plans, guidance, and outlook. Forward-looking statements inherently involve risks and uncertainties and only reflect our view as of today, May 4th, and we're under no obligation to update. When discussing our results, we refer to non-GAAP measures, which exclude certain items from reported results. Please refer to our first quarter 2026 earnings release and slides available at ir.gndx.com for definitions and reconciliations of non-GAAP measures and additional information regarding our results. including a discussion of factors that could cause actual results to materially differ from forward-looking statements. With that, I'll turn the call over to Catherine.

Thanks, Sabrina, and good afternoon, everyone. In the first quarter, GeneDx continued our mission of enabling everyone to live their healthiest life through genomics, leading the shift from diagnosing genetic conditions using multi-gene panels to the most comprehensive genetic tests available, exome and genome. In Q1, Exome and genome volume grew 34% year over year, demonstrating robust demand in our foundational markets and indicating positive early momentum in our expansion markets. Our competitive advantage continues to set us apart from others in the market. The combined strength of our large, diverse data set, GNDX Infinity, our team of genetics experts, And our advanced technology underpins product fundamentals that cement our leadership position, as evidenced by a loyal and growing customer base that drove this 34% volume growth in Q1. While volume growth outpaced our expectations, total revenue was $12 million lower than expected. We conducted a thorough channel-by-channel business review to diagnose what happened. And what we learned was that it was driven by two factors. First, approximately $5.5 million was due to a lower than expected blended average reimbursement rate for exome and genome. And second, approximately $6.5 million was due to softer than expected performance from our non-core business lines. As a result, we're updating our outlook for the year and now expect total revenue to be in the range of $475 to $490 million. with strong continued exome and genome volume growth of at least 30% and gross margins of approximately 70%. We're also committed to returning to profitability on an adjusted basis for the full year and expect profitability to grow significantly into 2027 and beyond as we continue to lead and shape this large and ever-expanding market. Now, I want to walk you through the Q1 revenue dynamics in more detail. Starting with the blended average reimbursement rate, ARR was primarily impacted by product mix with no structural changes in pricing. Through our business review, we identified clear opportunities to improve reimbursement dynamics, spanning commercial execution and revenue cycle management, and our team has already taken action. Moving to our non-core business lines, which includes Fabric and our BioPharma business. It's been one year since we closed the Fabric genomics acquisition, and it has become increasingly clear that the interpretation as a service product is best suited for international markets. We're fully integrating the Fabric team technology and services into the GDX brand, and we're focusing our resources to support international growth and key domestic drivers. We're lowering our expectations for revenue contribution in 2026 accordingly. On the biopharma and data business, we saw positive underlying momentum but fell short of delivering Q1 revenue due to a longer than anticipated sales cycle. As we continue to build demand for our data asset and engage with biopharma companies, large and small, our conviction around this business continues to strengthen. These partnerships can offer meaningful long-term value creation for patients and for GDX, and the value proposition will grow alongside our clinical testing business. With more than 2.5 million patients, more than a million exomes and genomes, and more than 8 million matched phenotypic profiles, our contactable database stands apart. We've right-sized revenue contribution to the 2026 guide based on high probability deals in our pipeline, positioning this business as upside as it continues to ramp. With our guidance now reflecting these shifts, and with the strong performance thus far in Q2, We're confident in the path forward with a massive focus on our core diagnostics business as the primary driver. Let's walk through each of the customer segments to give you more color. Starting with geneticists. As we continue to lead the market transition from multi-gene panels to exome and genome, geneticists are leaning into genome. This is an exciting development. We chose the ticker symbol WGS because we've always believed that the market would move to genome over time. But the speed of this transition in Q1 outpaced our expectations. We made the strategic decision to begin capturing the share. Importantly, the experts are the clinicians who are interested in genomes. Most patients in the outpatient setting remain best served by exome testing, given that it covers approximately 85% of known disease-causing mutations. GDX is best positioned to lead the genome future by leveraging our scale, brand, clinician relationship, first mover advantage, and vast data sets, GDX Infinity. Infinity enables us to interpret both coding and non-coding regions of the genome with speed and precision. And as genome coverage matures, access improves, and volumes scale, the flywheel effect of this additional data will compound our competitive advantage across our portfolio. Informed by early data, we launched a reflex offering in February to balance clinical demand with a relatively higher gross margin product. Customer feedback has been positive, and early adoption has reinforced that we can actively manage this market transition. Looking at pediatric specialists, we continued to deliver steady growth supported by exome utilization, high clinician retention, and low buzz things for sales in the quarter. However, the blended exome ARR came in lower than expected, based on the mix of tests submitted with parental comparative samples, a shift that we've already mobilized to correct with customer experience features, sales messaging, and incentives. We expect a return to longstanding XM reimbursement norms in the near future. In the NICU, we're seeing good progress driven by rapid and ultra-rapid genomes. It has been just over a year since the first study data was published demonstrating how a programmatic approach testing can ensure that every NICU baby who needs a genome receives one. Genome ARR and gross margins are desirable in the inpatient setting. And with a robust set of institutions already ordering from us, our focus remains on increasing utilization as accounts mature. We've expanded the sales team to accelerate this ramp and plan to leverage our dominant market position to fuel continued growth. General Pediatrics is our largest long-term opportunity and our earliest stage market. we're beginning to see encouraging signals with early XM orders coming in as our sales reps get accounts up and running. It typically takes several touch points and meetings before the first order is placed, and we're seeing that progression play out. While volumes are still modest, our experience is reinforcing that education, awareness, and service are all critical in this market. Our tailored customer experience for non-expert clinicians remains on track And upcoming workflow enhancements, including streamlined registration, bundled ordering, and improved post-test guidance are all designed to reduce friction and accelerate uptake in the second half of the year. And finally, prenatal. Demand has been building steadily in this new market, and we're seeing good traction with maternal fetal medicine physicians. Importantly, genome adoption appears additive to our small but existing exome volume in this channel. Stepping back, our core testing business is well-positioned to translate demand momentum into profitable growth. We have line of sight to at least 30% volume growth and approximately 70% growth margins on the XM and Genome portfolio, and we're committed to a return to profitability on the balance of the year. We've taken the decisive step of cutting $25 million of OPEX for the year, and we're putting our capital and team to work on the three biggest levers for the business. Number one, growing utilization of exome and genome. Number two, optimizing unit economics through both ARR and COGS. And number three, delivering the leading products to unmatched scale. Aligned around these three goals, we're moving forward with more clarity and operating rigor than ever before. With that, I'll pass it over to Kevin.