Guardant surges ~10% after clinical testing drives Q1 revenue; raises outlook

Guardant Health (NASDAQ:GH) stock rose ~11% on Wednesday after Q1 results beat estimates and the company raised its FY23 revenue outlook.

Non-GAAP net loss per share was -$1.06, compared to -$0.91 in Q1 2022.

Total revenue grew +34% Y/Y to $128.71M, driven by clinical volume growth of 45%. Both top and bottom line surpassed expectations.

"With the recent coverage of Guardant Response, we now have full Medicare coverage across our Therapy Selection and MRD product portfolios. This coverage will help drive continued volume growth as we approach breakeven in our Therapy Selection core business and execute on our strategy to be the worldwide leader in precision oncology," said Helmy Eltoukhy, co-founder and co-CEO.

Revenue from Precision oncology testing grew +34.7% Y/Y to $113.39M, mainly due to an increase in clinical testing volume and biopharma sample volume.

The company said it reported 39.1K tests to clinical customers and 6,150 tests to biopharmaceutical customers in Q1 2023, representing growth of +45% and 21%, respectively, over Q1 2022.

Meanwhile, revenue from Development services and other rose +28% Y/Y to $15.32M, mainly because of revenues earned from partnership agreements.

Adjusted EBITDA loss widened to -$101M, compared to -$86.6M in Q1 2022.

As of March 31, Guardant had cash, cash equivalents and marketable debt securities of $937M.

Outlook:

Guardant raised its full year 2023 revenue outlook to be in the range of $535M to $545M, compared to its previous range of $525M to $540M. Consensus $535.59M

The company noted that it continues to expect full year operating expenses to be below that of 2022, due to efficiency measures and use of its existing infrastructure, and free cash outflow to be ~$350M in 2023.