Guardant Health, Inc., a leading precision oncology company focused on helping conquer cancer globally through use of its proprietary tests, vast data sets and advanced analytics, reported financial results for the quarter and year ended December 31, 2021.
Q4 clinical and biopharma volumes up 48% and 36% year over year
REDWOOD CITY, Calif.--(BUSINESS WIRE)-- Guardant Health, Inc. (Nasdaq: GH), a leading precision oncology company focused on helping conquer cancer globally through use of its proprietary tests, vast data sets and advanced analytics, today reported financial results for the quarter and year ended December 31, 2021.
Recent Highlights
- Revenue of $108 million for the fourth quarter of 2021 and $374 million for the full year 2021, an increase of 38% and 30% over the corresponding period of 2020
- Reported 25,600 tests to clinical customers and 6,600 tests to biopharmaceutical customers in the fourth quarter of 2021, representing an increase of 48% and 36%, respectively, over the fourth quarter of 2020
- Reached enrollment of 12,750 patients in ECLIPSE pivotal study for its Guardant Shield blood test to detect colorectal cancer
- Enrolled first patient in SHIELD study to validate the performance of blood-based assay in lung cancer screening
- Successfully finalized a $25 million settlement plus royalty-bearing licensing agreement with Foundation Medicine
“2021 was a transformative year for Guardant and our team continued to push the boundaries to deliver a new paradigm of cancer care,” said Helmy Eltoukhy, co-founder and co-CEO. “Our commercial team continued to deliver strong growth during the fourth quarter with clinical volumes increasing 48% year over year. This growth was particularly strong in the community setting where Guardant360 CDx grew twice as fast as in the academic centers. Looking ahead to 2022, we are bringing to fruition our vision for providing clinically differentiated offerings that will span the entire continuum of cancer care, including treatment selection, response monitoring, MRD and screening.”
“We believe the promise of blood-based cancer screening is quickly becoming a reality and Guardant is well-positioned to fill this critical need,” said AmirAli Talasaz, co-founder and co-CEO. “A successful readout of ECLIPSE will open up a $20 billion screening opportunity in colorectal cancer by bringing high-performance life-saving tests to millions of people, and SHIELD Lung, along with other future studies, will open up opportunities in lung and additional cancer types, paving the way towards a total addressable screening market of more than $50 billion.”
Fourth Quarter 2021 Financial Results
Revenue was $108.1 million for the three months ended December 31, 2021, a 38% increase from $78.3 million for the three months ended December 31, 2020. Precision oncology revenue grew 37% driven predominantly by an increase in clinical testing revenue which grew 40% over the prior year period. There were 25,600 clinical tests and 6,600 biopharmaceutical tests performed during the fourth quarter of 2021. Development services and other revenue increased 43% primarily due to royalty revenues earned pursuant to a settlement and license agreement entered into in December 2021, and the progression of collaboration projects with biopharmaceutical customers for companion diagnostic development services during the three months ended December 31, 2021.
Gross profit, or total revenue less cost of precision oncology testing and cost of development services and other, was $74.7 million for the fourth quarter of 2021, an increase of $24.8 million from $49.9 million for the corresponding prior year period. Gross margin, or gross profit divided by total revenue, was 69%, as compared to 64% for the corresponding prior year period.
Operating expenses were $172.9 million for the fourth quarter of 2021, as compared to $141.1 million for the corresponding prior year period, an increase of 23%. Non-GAAP operating expenses were $146.2 million for the fourth quarter of 2021, as compared to $84.7 million for the corresponding prior year period.
Other income (expense) net increased to $25.9 million for the fourth quarter of 2021, from $1.2 million for the corresponding prior year period, primarily due to $25.0 million income pursuant to a settlement and license agreement entered into in December 2021.
Net loss attributable to Guardant Health, Inc. common stockholders was $90.9 million for the fourth quarter of 2021, as compared to $93.7 million for the corresponding prior year period. Net loss per share attributable to Guardant Health, Inc. common stockholders was $0.89 for the fourth quarter of 2021, as compared to $0.94 for the corresponding prior year period. Non-GAAP net loss was $70.4 million for the fourth quarter of 2021, as compared to $36.7 million for the corresponding prior year period. Non-GAAP net loss per share was $0.69 for the fourth quarter of 2021, as compared to $0.37 for the corresponding prior year period.
Adjusted EBITDA loss was $64.6 million for the fourth quarter of 2021, as compared to a $29.7 million loss for the corresponding prior year period.
Full Year 2021 Financial Results
Revenue was $373.7 million for the year ended December 31, 2021, a 30% increase from $286.7 million for the year ended December 31, 2020. Precision oncology revenue grew 29% driven predominantly by an increase in clinical testing revenue which grew 38% over the prior year period. There were 87,600 clinical tests and 18,600 biopharmaceutical tests performed during 2021. Development services and other revenue increased 38%.
Gross profit, or total revenue less cost of precision oncology testing and cost of development services and other, was $250.7 million for 2021, an increase of $56.5 million from $194.2 million for the corresponding prior year period. Gross margin, or gross profit divided by total revenue, was 67%, as compared to 68% for the corresponding prior year period.
Operating expenses were $661.7 million for 2021, as compared to $449.1 million for the corresponding prior year period, an increase of 47%. Non-GAAP operating expenses were $506.8 million for 2021, as compared to $295.2 million for the corresponding prior year period.
Other income (expense) net increased to $25.2 million for the year ended December 31, 2021, from $3.6 million for the year ended December 31, 2020, primarily due to $25.0 million income pursuant to a settlement and license agreement entered into in December 2021.
Net loss attributable to Guardant Health, Inc. common stockholders was $405.7 million for 2021, as compared to $253.8 million for the corresponding prior year period. Net loss per share attributable to Guardant Health, Inc. common stockholders was $4.00 for 2021, as compared to $2.60 for the corresponding prior year period. Non-GAAP net loss was $251.7 million for 2021, as compared to $91.0 million for the corresponding prior year period. Non-GAAP net loss per share was $2.48 for 2021, as compared to $0.93 for the corresponding prior year period.
Adjusted EBITDA loss was $231.5 million for 2021, as compared to a $84.4 million loss for the corresponding prior year period.
Cash, cash equivalents and marketable securities were $1.6 billion as of December 31, 2021.
2022 Guidance
Guardant Health expects full year 2022 revenue to be in the range of $460 million to $470 million, representing 23% to 26% growth over full year 2021.
Webcast Information
Guardant Health will host a conference call to discuss the fourth quarter 2021 financial results after market close on Wednesday, February 23, 2022 at 1:30 pm Pacific Time / 4:30 pm Eastern Time. A webcast of the conference call can be accessed at http://investors.guardanthealth.com. The webcast will be archived and available for replay for at least 90 days after the event.
Non-GAAP Measures
Guardant Health has presented in this release certain financial information in accordance with U.S. Generally Accepted Accounting Principles (GAAP) and also on a non-GAAP basis, including non-GAAP cost of precision oncology testing, non-GAAP research and development expense, non-GAAP sales and marketing expense, non-GAAP general and administrative expense, non-GAAP loss from operations, non-GAAP net loss, non-GAAP net loss attributable to Guardant Health, Inc. common stockholders, non-GAAP net loss per share attributable to Guardant Health, Inc. common stockholders, basic and diluted, and Adjusted EBITDA.
We define our non-GAAP measures as the applicable GAAP measure adjusted for the impacts of stock-based compensation and related employer payroll tax payments; changes in estimated fair value redeemable noncontrolling interest; contingent consideration; acquisition related expenses, amortization of intangible assets, and other non-recurring items.
Adjusted EBITDA is defined as net loss attributable to Guardant Health, Inc. common stockholders adjusted for interest income; interest expense; other income (expense), net, provision for (benefit from) income taxes; depreciation; and amortization expense; stock-based compensation expense and related employer payroll tax payments; adjustments relating to redeemable non-controlling interest and contingent consideration and, if applicable in a reporting period, acquisition-related expenses and other non-recurring items.
We believe that the exclusion of certain income and expenses in calculating these non-GAAP financial measures can provide a useful measure for investors when comparing our period-to-period core operating results, and when comparing those same results to that published by our peers. We exclude certain other items because we believe that these income (expenses) do not reflect expected future operating expenses. Additionally, certain items are inconsistent in amounts and frequency, making it difficult to perform a meaningful evaluation of our current or past operating performance. We use these non-GAAP financial measures to evaluate ongoing operations, for internal planning and forecasting purposes, and to manage our business.
These non-GAAP financial measures are not intended to be considered in isolation from, as substitute for, or as superior to, the corresponding financial measures prepared in accordance with GAAP. There are limitations inherent in non-GAAP financial measures because they exclude charges and credits that are required to be included in a GAAP presentation, and do not present the full measure of our recorded costs against its revenue. In addition, our definition of the non-GAAP financial measures may differ from non-GAAP measures used by other companies.
About Guardant Health
Guardant Health is a leading precision oncology company focused on helping conquer cancer globally through use of its proprietary tests, vast data sets and advanced analytics. The Guardant Health oncology platform leverages capabilities to drive commercial adoption, improve patient clinical outcomes and lower healthcare costs across all stages of the cancer care continuum. Guardant Health has commercially launched Guardant360®, Guardant360 CDx, Guardant360 TissueNext™, Guardant360 Response™, and GuardantOMNI® tests for advanced stage cancer patients, and Guardant Reveal™ for early-stage cancer patients. These tests fuel development of its screening program, which aims to address the needs of asymptomatic individuals eligible for cancer screening.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws, including statements relating to Guardant Health’s future results, or regarding the potential benefits and advantages of Guardant Health’s platforms, assays and tests, which involve risks and uncertainties that could cause Guardant Health’s actual results to differ materially from the anticipated results and expectations expressed in these forward-looking statements. These statements are based on current expectations, forecasts and assumptions, and actual outcomes and results could differ materially from these statements due to a number of factors. These and additional risks and uncertainties that could affect Guardant Health’s financial and operating results and cause actual results to differ materially from those indicated by the forward-looking statements made in this press release include those discussed under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and elsewhere in its Annual Report on Form 10-K for the year ended December 31, 2020, and any current and periodic reports filed with the Securities and Exchange Commission thereafter. The forward-looking statements in this press release are based on information available to Guardant Health as of the date hereof, and Guardant Health disclaims any obligation to update any forward-looking statements provided to reflect any change in its expectations or any change in events, conditions, or circumstances on which any such statement is based, except as required by law. These forward-looking statements should not be relied upon as representing Guardant Health’s views as of any date subsequent to the date of this press release.
| Guardant Health, Inc. | ||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||
| (unaudited) | ||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| Revenue: | ||||||||||||||||
| Precision oncology testing | $ | 88,707 | $ | 64,703 | $ | 304,312 | $ | 236,324 | ||||||||
| Development services and other | 19,401 | 13,613 | 69,341 | 50,406 | ||||||||||||
| Total revenue | 108,108 | 78,316 | 373,653 | 286,730 | ||||||||||||
| Costs and operating expenses: | ||||||||||||||||
| Cost of precision oncology testing | 32,254 | 22,070 | 110,396 | 74,769 | ||||||||||||
| Cost of development services and other | 1,168 | 6,337 | 12,516 | 17,766 | ||||||||||||
| Research and development expense | 73,021 | 40,282 | 263,221 | 149,862 | ||||||||||||
| Sales and marketing expense | 59,599 | 31,288 | 191,881 | 106,513 | ||||||||||||
| General and administrative expense | 40,274 | 69,505 | 206,640 | 192,770 | ||||||||||||
| Total costs and operating expenses | 206,316 | 169,482 | 784,654 | 541,680 | ||||||||||||
| Loss from operations | (98,208 | ) | (91,166 | ) | (411,001 | ) | (254,950 | ) | ||||||||
| Interest income | 653 | 1,900 | 3,930 | 10,171 | ||||||||||||
| Interest expense | (643 | ) | (4,736 | ) | (2,577 | ) | (4,766 | ) | ||||||||
| Other income (expense), net | 25,898 | 1,220 | 25,178 | 3,641 | ||||||||||||
| Loss before provision for income taxes | (72,300 | ) | (92,782 | ) | (384,470 | ) | (245,904 | ) | ||||||||
| Provision for income taxes | 11 | 263 | 300 | 379 | ||||||||||||
| Net loss | (72,311 | ) | (93,045 | ) | (384,770 | ) | (246,283 | ) | ||||||||
| Adjustment of redeemable noncontrolling interest | (18,600 | ) | (700 | ) | (20,900 | ) | (7,500 | ) | ||||||||
| Net loss attributable to Guardant Health, Inc. common stockholders | $ | (90,911 | ) | $ | (93,745 | ) | $ | (405,670 | ) | $ | (253,783 | ) | ||||
| Net loss per share attributable to Guardant Health, Inc. common stockholders, basic and diluted | $ | (0.89 | ) | $ | (0.94 | ) | $ | (4.00 | ) | $ | (2.60 | ) | ||||
| Weighted-average shares used in computing net loss per share attributable to Guardant Health, Inc. common stockholders, basic and diluted | 101,697 | 100,018 | 101,314 | 97,504 | ||||||||||||
| Guardant Health, Inc. | ||||||||
| Condensed Consolidated Balance Sheets (unaudited) | ||||||||
| (in thousands, except share and per share data) | ||||||||
| December 31, 2021 | December 31, 2020 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 492,202 | $ | 832,977 | ||||
| Short-term marketable securities | 440,546 | 961,903 | ||||||
| Accounts receivable, net | 97,652 | 53,299 | ||||||
| Inventory | 30,674 | 22,716 | ||||||
| Prepaid expenses and other current assets, net | 53,052 | 17,466 | ||||||
| Total current assets | 1,114,126 | 1,888,361 | ||||||
| Long-term marketable securities | 698,034 | 246,597 | ||||||
| Property and equipment, net | 124,461 | 62,782 | ||||||
| Right-of-use assets | 189,443 | 37,343 | ||||||
| Intangible assets, net | 14,207 | 16,155 | ||||||
| Goodwill | 3,290 | 3,290 | ||||||
| Other assets, net | 60,938 | 17,253 | ||||||
| Total Assets | $ | 2,204,499 | $ | 2,271,781 | ||||
| LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 17,580 | $ | 7,340 | ||||
| Accrued compensation | 42,496 | 28,280 | ||||||
| Accrued expenses | 45,285 | 22,639 | ||||||
| Noncontrolling interest liability | 78,000 | — | ||||||
| Deferred revenue | 11,326 | 8,550 | ||||||
| Total current liabilities | 194,687 | 66,809 | ||||||
| Convertible senior notes, net | 1,134,821 | 806,292 | ||||||
| Long-term operating lease liabilities | 226,053 | 41,565 | ||||||
| Other long-term liabilities | 3,933 | 1,520 | ||||||
| Total Liabilities | 1,559,494 | 916,186 | ||||||
| Redeemable noncontrolling interest | — | 57,100 | ||||||
| Stockholders’ equity: | ||||||||
| Common stock, par value of $0.00001 per share; 350,000,000 shares authorized as of December 31, 2021 and December 31, 2020; 101,767,446 and 100,213,985 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively | 1 | 1 | ||||||
| Additional paid-in capital | 1,657,593 | 1,902,389 | ||||||
| Accumulated other comprehensive (loss) income | (4,764 | ) | 2,697 | |||||
| Accumulated deficit | (1,007,825 | ) | (606,592 | ) | ||||
| Total Stockholders’ Equity | 645,005 | 1,298,495 | ||||||
| Total Liabilities, Redeemable Noncontrolling Interest and Stockholders’ Equity | $ | 2,204,499 | $ | 2,271,781 | ||||
| Guardant Health, Inc. | ||||||||||||||||
| Reconciliation of Selected GAAP Measures to Non-GAAP Measures | ||||||||||||||||
| (unaudited) | ||||||||||||||||
| (in thousands) | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| GAAP cost of precision oncology testing | $ | 32,254 | $ | 22,070 | $ | 110,396 | $ | 74,769 | ||||||||
| Amortization of intangible assets | (152 | ) | (301 | ) | (601 | ) | (442 | ) | ||||||||
| Stock-based compensation expense and related employer payroll tax payments | (1,174 | ) | (727 | ) | (3,623 | ) | (1,893 | ) | ||||||||
| Non-GAAP cost of precision oncology testing | $ | 30,928 | $ | 21,042 | $ | 106,172 | $ | 72,434 | ||||||||
| GAAP research and development expense | $ | 73,021 | $ | 40,282 | $ | 263,221 | $ | 149,862 | ||||||||
| Amortization of intangible assets | — | — | — | (43 | ) | |||||||||||
| Stock-based compensation expense and related employer payroll tax payments | (5,696 | ) | (2,716 | ) | (19,370 | ) | (10,219 | ) | ||||||||
| Acquisition related expenses | — | — | — | (8,500 | ) | |||||||||||
| Non-GAAP research and development expense | $ | 67,325 | $ | 37,566 | $ | 243,851 | $ | 131,100 | ||||||||
| GAAP sales and marketing expense | $ | 59,599 | $ | 31,288 | $ | 191,881 | $ | 106,513 | ||||||||
| Stock-based compensation expense and related employer payroll tax payments | (5,208 | ) | (3,032 | ) | (15,762 | ) | (9,406 | ) | ||||||||
| Non-GAAP sales and marketing expense | $ | 54,391 | $ | 28,256 | $ | 176,119 | $ | 97,107 | ||||||||
| GAAP general and administrative expense | $ | 40,274 | $ | 69,505 | $ | 206,640 | $ | 192,770 | ||||||||
| Amortization of intangible assets | (339 | ) | (189 | ) | (1,347 | ) | (1,270 | ) | ||||||||
| Stock-based compensation expense and related employer payroll tax payments | (14,951 | ) | (50,428 | ) | (116,105 | ) | (123,387 | ) | ||||||||
| Change in fair value of contingent consideration | (535 | ) | — | (2,380 | ) | 120 | ||||||||||
| Acquisition related expenses | — | — | — | (1,207 | ) | |||||||||||
| Non-GAAP general and administrative expense | $ | 24,449 | $ | 18,888 | $ | 86,808 | $ | 67,026 | ||||||||
| GAAP loss from operations | $ | (98,208 | ) | $ | (91,166 | ) | $ | (411,001 | ) | $ | (254,950 | ) | ||||
| Amortization of intangible assets | 491 | 490 | 1,948 | 1,755 | ||||||||||||
| Stock-based compensation expense and related employer payroll tax payments | 27,029 | 56,903 | 154,860 | 144,905 | ||||||||||||
| Change in fair value of contingent consideration | 535 | — | 2,380 | (120 | ) | |||||||||||
| Acquisition related expenses | — | — | — | 9,707 | ||||||||||||
| Non-GAAP loss from operations | $ | (70,153 | ) | $ | (33,773 | ) | $ | (251,813 | ) | $ | (98,703 | ) | ||||
| GAAP net loss | $ | (72,311 | ) | $ | (93,045 | ) | $ | (384,770 | ) | $ | (246,283 | ) | ||||
| Amortization of intangible assets | 491 | 490 | 1,948 | 1,755 | ||||||||||||
| Stock-based compensation expense and related employer payroll tax payments | 27,029 | 56,903 | 154,860 | 144,905 | ||||||||||||
| Change in fair value of contingent consideration | 535 | — | 2,380 | (120 | ) | |||||||||||
| Acquisition related expenses | — | — | — | 9,707 | ||||||||||||
| Non-recurring other income | (26,100 | ) | (1,000 | ) | (26,100 | ) | (1,000 | ) | ||||||||
| Non-GAAP net loss | $ | (70,356 | ) | $ | (36,652 | ) | $ | (251,682 | ) | $ | (91,036 | ) | ||||
| GAAP net loss attributable to Guardant Health, Inc. common stockholders | $ | (90,911 | ) | $ | (93,745 | ) | $ | (405,670 | ) | $ | (253,783 | ) | ||||
| Amortization of intangible assets | 491 | 490 | 1,948 | 1,755 | ||||||||||||
| Stock-based compensation expense and related employer payroll tax payments | 27,029 | 56,903 | 154,860 | 144,905 | ||||||||||||
| Change in fair value of contingent consideration | 535 | — | 2,380 | (120 | ) | |||||||||||
| Acquisition related expenses | — | — | — | 9,707 | ||||||||||||
| Non-recurring other income | (26,100 | ) | (1,000 | ) | (26,100 | ) | (1,000 | ) | ||||||||
| Adjustments relating to redeemable non-controlling interest | 18,600 | 700 | 20,900 | 7,500 | ||||||||||||
| Non-GAAP net loss attributable to Guardant Health, Inc. common stockholders | $ | (70,356 | ) | $ | (36,652 | ) | $ | (251,682 | ) | $ | (91,036 | ) | ||||
| GAAP net loss per share attributable to Guardant Health, Inc., common stockholders, basic and diluted | $ | (0.89 | ) | $ | (0.94 | ) | $ | (4.00 | ) | $ | (2.60 | ) | ||||
| Non-GAAP net loss per share attributable to Guardant Health, Inc., common stockholders, basic and diluted | $ | (0.69 | ) | $ | (0.37 | ) | $ | (2.48 | ) | $ | (0.93 | ) | ||||
| Weighted-average shares used in computing GAAP and Non-GAAP net loss per share, basic and diluted | 101,697 | 100,018 | 101,314 | 97,504 | ||||||||||||
| Guardant Health, Inc. | ||||||||||||||||
| Reconciliation of GAAP Net Loss Attributable to Guardant Health, Inc. Common Stockholders to Adjusted EBITDA | ||||||||||||||||
| (unaudited) | ||||||||||||||||
| (in thousands) | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| GAAP net loss attributable to Guardant Health, Inc. common stockholders | $ | (90,911 | ) | $ | (93,745 | ) | $ | (405,670 | ) | $ | (253,783 | ) | ||||
| Interest income | (653 | ) | (1,900 | ) | (3,930 | ) | (10,171 | ) | ||||||||
| Interest expense | 643 | 4,736 | 2,577 | 4,766 | ||||||||||||
| Other (income) expense, net | (25,898 | ) | (1,220 | ) | (25,178 | ) | (3,641 | ) | ||||||||
| Provision for income taxes | 11 | 263 | 300 | 379 | ||||||||||||
| Depreciation and amortization | 6,090 | 4,603 | 22,271 | 16,065 | ||||||||||||
| Stock-based compensation expense and related employer payroll tax payments | 27,029 | 56,903 | 154,860 | 144,905 | ||||||||||||
| Change in fair value of contingent consideration | 535 | — | 2,380 | (120 | ) | |||||||||||
| Acquisition related expenses | — | — | — | 9,707 | ||||||||||||
| Adjustments relating to redeemable non-controlling interest | 18,600 | 700 | 20,900 | 7,500 | ||||||||||||
| Adjusted EBITDA | $ | (64,554 | ) | $ | (29,660 | ) | $ | (231,490 | ) | $ | (84,393 | ) | ||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20220223005574/en/
Investor Contact:
Carrie Mendivil
investors@guardanthealth.com
Media Contact:
Michele Rest
press@guardanthealth.com
Source: Guardant Health, Inc.
View this news release online at:
http://www.businesswire.com/news/home/20220223005574/en
