CareDx Q2 Earnings Call Highlights

Key Points

• CareDx’s second-quarter revenue rose 52% to $132 million, driven by a 61% increase in testing-services revenue and a 17% rise in testing volume to 58,000 tests. Adjusted EBITDA reached $25 million, while GAAP net income included a $113 million gain from selling the lab products business.
• The company raised its 2026 outlook to $490 million–$500 million in revenue and $66 million–$78 million in adjusted EBITDA, incorporating specialty oncology revenue from the NavDx acquisition and removing a previously expected $7.5 million Medicare coverage impact.
• CareDx is expanding its transplant diagnostics pipeline and integrating NavDx, while advancing AlloHeme and HistoMap toward future launches. Management said finalized Medicare coverage supports transplant surveillance testing and may create a future pathway for HistoMap.

CareDx NASDAQ: CDNA reported second-quarter 2026 revenue growth of 52% as the transplant diagnostics company expanded testing services, completed the sale of its lab products business and began integrating the recently acquired NavDx specialty oncology platform.

Total revenue rose to $132 million for the quarter ended June 30, including $100 million in testing-services revenue, $19 million from patient and digital solutions and $13 million from lab products. Testing-services revenue increased 61% year over year, while testing volume increased 17% to 58,000 tests. The company said testing-services revenue included $15.6 million of out-of-period revenue.

CareDx reported non-GAAP gross margin of 74%, up from the prior year, and adjusted EBITDA of $25 million, or 19% of revenue, representing a $19 million increase. GAAP net income was $111 million, or $2.07 per diluted share, including a $113 million gain associated with the sale of the lab products business. The company ended the quarter with $374 million in cash and cash equivalents and no debt.

Guidance Raised Following NavDx Addition

Chief Operating Officer and Chief Financial Officer Keith Kennedy said CareDx raised its full-year 2026 revenue outlook to a range of $490 million to $500 million. At the $495 million midpoint, the forecast would represent 30% year-over-year growth.

The company projected adjusted EBITDA of $66 million to $78 million, with a midpoint of $72 million, or about 15% of revenue. Guidance includes specialty oncology testing services in the second half following the July 1 closing of the NavDx acquisition.

• Full-year testing volume is expected to be between 258,000 and 266,000 tests.
• Testing-services revenue is expected to total approximately $400 million, including $24 million from specialty oncology.
• Patient and digital revenue is forecast at $72 million, while lab products revenue is expected to be $23 million, reflecting first-half activity.
• Non-GAAP gross margin is expected to range from 71% to 73%.

Kennedy said the company removed a previously embedded $7.5 million potential impact from the Medicare Local Coverage Determination from its outlook after the policy was finalized. The LCD, effective at the end of August, affirms coverage for surveillance molecular testing in kidney, heart and lung transplantation, according to management.

For the third quarter, CareDx’s midpoint guidance assumes 72,600 total tests, including 58,000 transplant tests and 14,600 specialty oncology tests. Fourth-quarter assumptions call for 76,300 total tests, including 60,000 transplant tests and 16,300 specialty oncology tests.

Transplant Testing and Coverage Developments

President and Chief Executive Officer John Hanna said the company continues to see both surveillance and for-cause testing gain adoption in transplant care. During the question-and-answer session, Hanna said CareDx’s efforts to improve clinical workflows, blood draws, order submissions and result review have helped increase the average number of surveillance tests per patient during the first one and three years after transplantation.

Hanna said for-cause testing also continues to expand, adding that CareDx remains “a little over 50%” in kidney testing for that use case.

At the American Transplant Congress, CareDx data were featured in more than 30 abstracts and nine oral presentations across kidney, heart, lung and multi-organ transplantation, Hanna said. He highlighted a study of more than 1,100 kidney-transplant recipients from the KOAR registry, in which approximately 35% of patients with persistently elevated AlloSure levels experienced rejection and had a ninefold greater risk of graft loss compared with patients whose levels remained consistently low.

The company also cited a separate KOAR analysis published in the Journal of the American Society of Nephrology involving more than 1,250 kidney-transplant recipients across 56 U.S. centers. Hanna said patients with elevated AlloSure levels had a nearly four- to sixfold greater risk of graft loss, with many elevations occurring before measurable kidney-function declines.

The finalized Medicare policy also creates a potential future coverage pathway for HistoMap, CareDx’s molecular biopsy assessment offering, in cases where conventional biopsy findings are indeterminate or inconsistent with a patient’s clinical presentation, Hanna said.

Pipeline and Specialty Oncology Integration

CareDx said it remains on track to complete Clinical Laboratory Improvement Amendments readiness activities for AlloHeme by year-end, supporting a planned 2027 commercial launch. AlloHeme is being developed as a recurrence-monitoring test for patients receiving cell therapy for acute myeloid leukemia and myelodysplastic syndromes.

Investigators in the ACROBAT trial submitted an AlloHeme clinical-validation manuscript to a peer-reviewed journal during the second quarter. According to Hanna, the study found that AlloHeme predicted relapse a median of 41 days before clinical relapse was diagnosed.

HistoMap Kidney is expected to launch in a clinical study this year, with broader commercial availability planned for 2027. CareDx cited recently published data from 138 kidney-transplant biopsy specimens in which the test differentiated high- and low-risk patients among those with a microvascular inflammation phenotype. The high-risk group had more than three times the graft-loss rate at six years compared with the low-risk group, according to the company.

Following the July 1 acquisition close, CareDx has focused its NavDx integration efforts on commercial adoption, electronic workflow connectivity and revenue-cycle management. Hanna said NavDx adds a solid-tumor molecular residual disease platform in specialty oncology, particularly for HPV-driven head and neck cancers.

Kennedy said CareDx expects specialty oncology volumes in the second half to increase about 30% from the prior year. He said the company is working to transition the business to its billing system and believes specialty oncology average selling prices could ultimately move toward $1,000 to $1,100, compared with midpoint assumptions of $770 in the third quarter and $795 in the fourth quarter.

CareDx is also expanding the dedicated NavDx sales team, Hanna said, with the goal of reaching additional potential ordering providers and increasing testing utilization per patient.

About CareDx (NASDAQ:CDNA)

CareDx, Inc NASDAQ: CDNA is a precision diagnostics company focused on the care of transplant patients. The firm develops and commercializes non‐invasive tests designed to detect organ transplant rejection and infection risk, helping physicians make informed management decisions throughout the post‐transplant journey.

The company's core product portfolio includes AlloMap®, a gene expression profiling test for heart transplant recipients, and AlloSure®, a donor‐derived cell‐free DNA assay used primarily in kidney transplant monitoring.

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