Myriad Genetics Q3 Earnings Call Highlights

Key Points

• Q3 revenue was $202.7 million, down 1% year over year, as growth in cancer and mental health testing was offset by lower prenatal revenue. Myriad raised its 2026 revenue guidance midpoint to $785 million, while reporting an adjusted EBITDA loss of $5.3 million.
• Myriad agreed to sell its prenatal business to Labcorp for $210 million in cash plus inventory, aiming to focus on cancer testing. The company expects the sale to lift gross margin by more than 5 percentage points and improve its revenue growth rate by more than 1 percentage point.
• Reimbursement denials are pressuring hereditary cancer test revenue per test, though it improved 9% sequentially. Myriad is introducing revenue-cycle and payer strategies to address the issue and expects average revenue per test to decline 1%–5% over the medium to long term.

Myriad Genetics NASDAQ: MYGN reported third-quarter revenue of $202.7 million, down 1% from a year earlier, as growth in cancer and mental health testing was offset by a decline in its prenatal business. The company raised its full-year revenue outlook and said early efforts to address reimbursement denials helped improve revenue per test.

Revenue rose 6% from the second quarter, while average revenue per test increased 7% sequentially and 1% year over year. Total test volumes fell 2% from the prior-year period. Gross margin was 67.9%, up 1.3 percentage points from the second quarter but down 2 percentage points year over year.

Myriad posted an adjusted earnings before interest, taxes, depreciation and amortization loss of $5.3 million and an adjusted loss per share of $0.11. Chief Financial Officer Ben Wheeler said the sequential improvement in adjusted EBITDA reflected stronger revenue and disciplined operating expenses.

Prenatal Sale to Refocus Business

Myriad has agreed to sell its prenatal health business to Labcorp for $210 million in cash plus inventory. President and CEO Sam Raha said the transaction would allow Myriad to focus more closely on cancer testing and strengthen its financial profile.

The prenatal business generated $39 million in third-quarter revenue, down 12% year over year, as test volume declined 11%. Raha said approximately 500 Myriad employees are expected to move to Labcorp, and the companies expect to maintain patient access to prenatal testing through the transition.

Wheeler said Myriad expects its revenue growth rate to improve by more than 1 percentage point and gross margin to increase by more than 5 percentage points following the divestiture. The company also expects meaningful progress toward bottom-line profitability in 2027, although it did not quantify that outlook.

Myriad is considering uses for the sale proceeds, including debt repayment, internal and external growth investments, and general corporate purposes. Wheeler said it was too early to provide more specific capital allocation plans.

Reimbursement Pressure and Guidance

Revenue from the Cancer Care Continuum business rose 1% to $124 million. Test volume grew 4% to 98,000, offset by a 3% decline in average revenue per test. Hereditary cancer test volume increased 6%.

Average revenue per hereditary cancer test remained 6% below the prior-year level but improved 9% from the second quarter. Wheeler attributed reimbursement pressure primarily to more claims receiving no payment or being denied, rather than to contract changes or changes in medical policy.

Myriad has introduced revenue-cycle process improvements and a payer-by-payer market access strategy to address reimbursement friction. Wheeler said the company expects hereditary cancer testing revenue per test to decline by an average of 1% to 5% over the medium to long term, potentially skewing toward 3% to 5% in more recent years. Individual years could fall outside that range, he said.

For 2026, Myriad raised the midpoint of its revenue guidance to $785 million from $780 million, with a new range of $780 million to $790 million. Wheeler said the increase reflected third-quarter outperformance, partly offset by an approximately $5 million reduction in the fourth-quarter prenatal revenue expectation because of potential volume softness following the sale announcement.

Product Updates and Operating Plans

GeneSight, Myriad’s mental health test, generated $40 million in third-quarter revenue, up 2%, as volume increased 3%. Raha said more than 40,000 clinicians ordered the test during the quarter.

For its Precise MRD test, Raha cited an interim analysis of colorectal cancer patients in the MONSTAR-3 study. He said 91% of patients whose cancer recurred tested positive one month after surgery, while the remaining 9% were identified as positive through serial testing. The overall study is still maturing, he said.

Myriad expects reimbursement for Precise MRD in breast cancer to begin in the first half of 2027, followed by colorectal and renal cancer later that year. Raha said the company intends to manage testing demand prudently until reimbursement is established.

Myriad is also pursuing a multiyear operating initiative called Ascend, aimed at improving processes, productivity and costs. Raha said the company has begun taking action and expects to share more about the initiative and its anticipated impact as it moves into 2027.

About Myriad Genetics (NASDAQ:MYGN)

Myriad Genetics, Inc is a molecular diagnostics company that develops and provides genetic tests and related services to help healthcare providers assess disease risk, guide treatment decisions and support patient care. The company's testing portfolio spans hereditary cancer, precision oncology, women's health, mental health and other clinical applications.

Its products include hereditary cancer risk tests such as MyRisk and BRACAnalysis, which evaluate inherited genetic variants associated with cancers including breast and ovarian cancer.

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