Natera Q2 Earnings Call Highlights

Key Points

• Natera reported strong Q2 growth, with revenue up approximately 38% year over year to $753 million and testing volume surpassing 1 million units for the second consecutive quarter. MRD testing volume rose 56% year over year to 283,000 tests.
• The company raised its 2026 revenue guidance to $2.85 billion-$2.91 billion, while gross margin reached about 65% and Signatera’s average selling price increased to approximately $1,275.
• Signatera gained major regulatory and clinical momentum, including FDA companion-diagnostic approval in bladder cancer, Japanese approval for colorectal cancer, European IVDR certification and a Category 1 NCCN recommendation for bladder cancer treatment guidance.

Natera NASDAQ: NTRA reported second-quarter 2026 revenue of approximately $753 million, up about 38% from a year earlier, as record testing volumes and higher average selling prices supported growth across its oncology, women’s health and organ health businesses.

The company processed approximately 1.044 million tests during the quarter, its second consecutive quarter above 1 million units. Clinical molecular residual disease, or MRD, testing volume reached 283,000 units, up about 56% from the prior-year period and 34,000 units higher than in the first quarter.

Chief Executive Officer Steve Chapman called the period “an exceptional quarter,” citing commercial momentum for the Signatera oncology test, favorable regulatory developments and continued reimbursement progress.

Revenue guidance raised as margins improve

Natera raised its full-year revenue outlook to a range of $2.85 billion to $2.91 billion, increasing the midpoint by $100 million. The updated outlook implies approximately 31% annual revenue growth excluding revenue true-ups, according to management. The company held its operating-expense outlook steady.

Second-quarter revenue included about $52 million of revenue true-ups, which management said were declining both in dollar terms and as a share of revenue. Excluding those true-ups, revenue increased about 40% year over year.

Gross margin was approximately 65%, aided by improved average selling prices. Signatera’s average selling price rose to roughly $1,275, as the company cited more consistent reimbursement from Medicare Advantage and commercial insurers in states with biomarker legislation.

Management said it continues to target a mature Signatera average selling price of about $2,000 over the long term. Chief Financial Officer Mike Brophy said the company’s full-year guidance assumes stable Signatera pricing through the remainder of 2026, though an upside case could include another roughly $25 of sequential price improvement.

Natera also reported positive cash inflow during the quarter and a narrower loss per share. Days sales outstanding declined by roughly four days sequentially to an average of 57 days, Brophy said.

Signatera reaches regulatory and guideline milestones

The company highlighted several developments for Signatera, its tumor-informed MRD test. In May, the FDA approved Signatera as a companion diagnostic for patients with muscle-invasive bladder cancer, which Natera described as the first FDA approval of an MRD test as a companion diagnostic.

In June, Japan’s Pharmaceuticals and Medical Devices Agency approved Signatera for colorectal cancer. Natera expects a commercial launch in Japan later in 2026, pending final pricing and reimbursement decisions. The company also submitted Signatera for Japanese approval as a companion diagnostic in bladder cancer and expects a decision later this year or in early 2027.

In July, Signatera received IVDR certification in Europe across more than 20 solid-tumor types. Natera said the designation should streamline future clinical-trial launches in the European Union and support its longer-term reimbursement efforts in the region.

The National Comprehensive Cancer Network also issued a Category 1 recommendation for Signatera-guided adjuvant treatment in muscle-invasive bladder cancer. Solomon Moshkevich, president of clinical diagnostics, said the recommendation has contributed to new customer starts, broader use among existing customers and new commercial payer coverage policies.

Management said colorectal and breast cancer remain Signatera’s largest indications, while adoption has also expanded across a longer tail of tumor types. Chapman said the company sees the MRD market as still in an early stage of penetration.

Women’s health and organ health developments

Women’s health delivered high-single-digit growth on a seasonally adjusted basis, despite the second quarter typically being Natera’s softest period for the business. The company attributed the performance to new account wins associated with Fetal Focus and the May launch of an enhanced Panorama prenatal test.

Moshkevich said the updated Panorama test uses SNP-informed deep sequencing technology and reduced the overall no-call rate to 0.5% from about 2% under the prior version. He said prospective blinded studies supporting the launch included more than 3,300 patients, including more than 240 low-fetal-fraction cases.

In organ health, Natera said a final Medicare local coverage determination for transplant surveillance, published in July and effective Aug. 30, expanded the frequency of covered testing for kidney, heart and lung transplant recipients. Management expects the policy to benefit Prospera testing volumes and average selling prices during the second half of the year.

Clinical studies and early cancer detection investment

Natera said it has opened more than 70 prospective studies involving Signatera through company-sponsored trials, biopharmaceutical partnerships and academic collaborations. Chief Medical Officer Alexey Aleshin said the company expects study readouts to accelerate over the next several years and views them as potential catalysts for clinical guidelines, reimbursement and testing volume.

The company also announced that its SIGNAL-ER 101 breast-cancer study is open. The prospective interventional study is evaluating whether Signatera can identify patients with early-stage HR-positive, HER2-negative breast cancer who may benefit from escalation to a CDK4/6 inhibitor after surgery and treatment.

For early cancer detection, Natera said its pivotal FIND study is approaching full enrollment. The company expects to complete enrollment in the third quarter with approximately 24,000 average-risk adults enrolled and plans to report FIND results in 2027.

Brophy said Natera expects to spend roughly $100 million this year on early cancer detection development work and the FIND trial. He added that the company is pursuing cost-reduction projects for recently introduced products, including Fetal Focus, Latitude and Signatera Genome, as testing volumes scale over the next 12 to 18 months.

About Natera (NASDAQ:NTRA)

Natera is a global diagnostics company that develops and commercializes cell-free DNA and other genetic testing technologies for clinical applications. The company focuses on three principal areas: reproductive health (including non-invasive prenatal testing and carrier screening), oncology (tumor-informed assays for minimal residual disease and recurrence monitoring), and organ transplantation (cell-free DNA tests to detect allograft injury). Natera combines laboratory testing, proprietary bioinformatics, and clinical reporting to deliver personalized genetic information to clinicians and patients.

Key product offerings include Panorama, a non-invasive prenatal test that screens for fetal chromosomal abnormalities and select single-gene conditions; Horizon carrier screening for inherited conditions; Signatera, a personalized, tumor-informed assay used for detecting minimal residual disease and monitoring treatment response in cancer patients; and Prospera, a donor-derived cell-free DNA test used to assess the risk of organ rejection.

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