SOPHiA GENETICS Q2 Earnings Call Highlights

Key Points

• Q2 revenue rose 27% to $23.3 million, while patient analyses reached a record 115,000 and the adjusted EBITDA loss narrowed to $8.8 million. U.S. revenue grew 64%, and liquid biopsy revenue increased 80% year over year.
• SOPHiA GENETICS expanded its customer base and signed its first two companion diagnostic programs with AstraZeneca. The multiyear agreements are expected to contribute meaningfully from 2027 onward, while a proposed AI-focused joint venture with Memorial Sloan Kettering remains under development.
• The company raised its 2026 revenue outlook to $94 million-$96 million and maintained its adjusted EBITDA loss guidance of $29 million-$32 million. Management expects to approach adjusted EBITDA breakeven by year-end 2026 and achieve positive adjusted EBITDA in the second half of 2027.

SOPHiA GENETICS NASDAQ: SOPH reported second-quarter revenue growth of 27% and raised its full-year revenue outlook, as the precision medicine software company cited accelerating U.S. adoption, liquid biopsy momentum and new biopharma agreements.

Revenue for the second quarter totaled $23.3 million, up from $18.3 million a year earlier. Platform analysis volume reached a record 115,000 patient analyses, an increase of 22% from the prior-year period. The company reported an adjusted EBITDA loss of $8.8 million, compared with a loss of $12 million in the second quarter of 2025.

“Revenue is accelerating, the network is built, the platform thesis is proven,” CEO Ross Muken said on his first earnings call since taking the role. Muken said the company’s focus is now on executing its growth strategy and scaling its platform for precision medicine.

U.S. and Liquid Biopsy Drive Growth

The U.S. was a primary contributor to second-quarter growth. U.S. revenue increased 64% year over year, while U.S. volume rose 60%, driven in part by customers beginning to come online, according to management.

Muken said demand in the U.S. is broad-based as hospitals and laboratories increasingly consider in-house genomic testing capabilities. He pointed to particular demand for the company’s enhanced exome offering and hematological oncology applications, while also citing early interest in in-house liquid biopsy and comprehensive genomic profiling testing.

The company signed Children’s Hospital of Philadelphia during the quarter and said the organizations are developing a liquid biopsy test designed for pediatric cancers.

Liquid biopsy revenue grew 80% year over year during the quarter. SOPHiA GENETICS added customers including AZ Delta Roeselare in Belgium, Policlinico Riuniti Hospital at the University of Foggia in Italy, and Sultan Qaboos Cancer Center in Oman. The company has now signed 80 liquid biopsy customers globally, with more than half not yet generating revenue, Muken said.

Chief Financial Officer George Cardoza said Asia-Pacific volume grew 27% and revenue increased 31% during the quarter. Hematological oncology volumes increased 34%, while rare-disease volumes rose 35%. Solid tumor testing also grew slightly faster than the company average, supported by newer applications including its CGP test and MSK-IMPACT Flex.

Customer Expansion and Biopharma Programs

Core genomic customers totaled 542 as of June 30, compared with 490 a year earlier. The company implemented 40 new customers during the first half that have entered routine usage. Net dollar retention rose to 117% from 107% in the year-earlier period, while annualized revenue churn was less than 1%.

Muken said SOPHiA GENETICS has slightly more than 2.5 applications per customer on average, leaving room to expand adoption within existing accounts. He cited customer adoption across liquid biopsy, solid tumor testing, hematological malignancies, hereditary cancer and rare disease applications.

The company also announced two companion diagnostic, or CDx, programs with AstraZeneca, its first such wins. One program will develop SOPHiA GENETICS’ solid tumor application into a decentralized companion diagnostic, while the other will use its hematological oncology application to support a blood cancer therapy.

Management said the agreements are multiyear arrangements with tiered milestones and are expected to affect growth primarily in 2027 and beyond, with only modest second-half 2026 contribution. Muken said the programs could also support future real-world evidence assets and clinical intelligence tools.

Separately, SOPHiA GENETICS and Memorial Sloan Kettering announced a memorandum of understanding to form a joint venture aimed at creating an “AI lab of the future” in New York City. The proposed venture would combine Memorial Sloan Kettering’s clinical expertise, testing footprint and multimodal data with SOPHiA GENETICS’ AI platform. Management said it is still working toward a definitive agreement and did not provide financial details.

Margins, Costs and Litigation

Gross profit was $15.1 million, up 23% from a year earlier, while gross margin declined to 64.6% from 67%. Adjusted gross margin was 72.1%, compared with 74.4% in the prior-year quarter.

Cardoza attributed the margin decline primarily to a greater contribution from biopharma and services revenue. Biopharma projects generally have higher costs at the start, while customer implementation services, including robotics and next-generation sequencing workflow support, carry lower margins than the company’s standard analysis business.

Total operating expenses were $35.1 million, up from $30.8 million a year earlier. The company recorded about $1.25 million in restructuring costs related to terminations and severance following cost actions taken in April. It also incurred approximately $1.1 million in net legal expenses related to patent litigation filed by Guardant Health.

Cardoza said the Unified Patent Court Court of Appeals in Paris rejected Guardant’s appeal on July 2, confirming there would be no injunction and that SOPHiA GENETICS could continue commercializing the MSK-ACCESS test without restriction. U.K. proceedings remain ongoing, according to the company.

Outlook and Capital Position

SOPHiA GENETICS raised its 2026 revenue guidance to a range of $94 million to $96 million, representing expected growth of 22% to 24%. The prior outlook was $92 million to $94 million.

The company reaffirmed its full-year adjusted EBITDA loss guidance of $29 million to $32 million, compared with an adjusted EBITDA loss of $41.5 million in 2025. Management expects to approach adjusted EBITDA breakeven by the end of 2026 and reach positive adjusted EBITDA in the second half of 2027.

In June, the company completed an oversubscribed public offering that raised approximately $57.5 million in gross proceeds. Cash and cash equivalents were $107.7 million at the end of the second quarter. Management said the capital position is sufficient to support its growth plans while it continues targeted hiring in commercial roles, particularly in the U.S.

About SOPHiA GENETICS (NASDAQ:SOPH)

SOPHiA GENETICS SA is a data-driven medicine company founded in 2011 and headquartered in La Tène, Switzerland. The firm develops and operates a cloud-native software platform designed to standardize and analyze complex genomic and radiomic data. Its core offering, the SOPHiA DDM™ platform, leverages artificial intelligence and machine learning algorithms to help healthcare institutions, laboratories and biopharmaceutical partners derive actionable insights from next-generation sequencing and medical imaging datasets.

The SOPHiA DDM™ platform supports a range of clinical applications, including oncology, hereditary diseases and rare genetic disorders.

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