Title

Presentation

Natera, Inc. misses on earnings expectations. Reported EPS is $-0.6 EPS, expectations were $-0.53.

Operator: Ladies and gentlemen, welcome to Natera, Inc.’s First Quarter 2026 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following management’s prepared remarks, we will hold a question and answer session. To ask a question at that time, please press star followed by one, or star zero for operator assistance. As a reminder, this conference call is being recorded today, May 7, 2026. I would now like to turn the conference over to Michael Brophy, Chief Financial Officer. Please go ahead.

Michael Brophy: Thank you for joining our conference call to discuss the results of 2026. On the line, I am joined by Steven Leonard Chapman, our CEO, Solomon Moshkevich, President, Clinical Diagnostics, and Alexey Aleshin, General Manager of Oncology and our Chief Medical Officer. Today’s conference call is being broadcast live via webcast. We will be referring to a slide presentation that has been posted to investors.natera.com. A replay of the call will also be posted to our IR website as soon as it is available. Starting on Slide 2, during the course of this conference call, we will make forward-looking statements regarding future events and our anticipated future performance, such as our operational and financial outlook and projections, our assumptions for that outlook, market size, partnerships, clinical studies and expected results, opportunities and strategies, and expectations for current and future products, including product capabilities, expected release dates, reimbursement coverage, and related effects on our financial and operating results.

We caution you that such statements reflect our best judgment based on factors currently known to us and that actual events or results could differ materially. Please refer to the documents we file from time to time with the SEC, including our most recent Forms 10-K or 10-Q and the Form 8-Ks filed with today’s press release. Those documents identify important risks and other factors that may cause our actual results to differ materially from those contained in or suggested by the forward-looking statements. Forward-looking statements made during the call are being made as of today, May 7, 2026. If this call is replayed or reviewed after today, the information presented during the call may not contain current or accurate information. Natera, Inc.

disclaims any obligation to update or revise any forward-looking statements. We will provide guidance on today’s call but will not provide any further guidance or updates on our performance during the quarter unless we do so in a public forum. We will quote a number of numeric or growth changes as we discuss our financial performance, and unless otherwise noted, each such reference represents a year-on-year comparison. And now I would like to turn the call over to Steve. Steven?

Steven Leonard Chapman: Thanks, Mike. Let us get to the highlights. We had another excellent quarter as you can see here. We posted revenues of $697 million in Q1, 39% growth over last year. Even at our scale, Q1 shows we are still in rapid growth mode. It was just a short while ago that we celebrated a milestone by delivering 1 million units in a year. Q1 was our first to deliver 1 million units in a single quarter, headlined by excellent volume performance in women’s health and another record growth quarter for oncology. We feel like we are just getting started. On women’s health, the core business grew exceptionally well and we had a very successful launch of our Fetal Focus product. The Fetal Focus launch is exceeding expectations based on the strength of our technology and data from the prospective blinded multi-site EXPAND trial.

We are winning new customers and experiencing high client retention rates. We are approaching a run rate of nearly 200 thousand Fetal Focus orders, which is impressive given our recent launch date. In oncology, we processed 249 thousand clinical oncology units in the quarter, which is 55% growth over last year and yet another record, with roughly 24 thousand units over the Q4 results. This is the biggest increase we have ever achieved. In February, we guided to full-year gross margins of 64% at the midpoint, and we are pleased to have exceeded that level in Q1 with gross margins coming in at just under 65%. The rapid increase in volumes in Q1 actually harmed margins by roughly two percentage points because we had more samples in process in the lab at the close of the quarter than normal, impacting our received versus reported ratio.

This will resolve itself as we move forward. We believe we are in a very good position relative to the guide. Given the fantastic start to the year, we are pleased to fully reset the revenue guide range by more than $120 million and increase our gross margin guidance to 65% at the midpoint. Enrollment in oncology clinical trials, including new interventional MRD trials and a FIND ECD study, are well ahead of schedule, so we are going to bump R&D expectations by $50 million, primarily to pull forward these trials. Of note, on the FIND ECD study, we are pleased to announce that we should be fully done enrolling in Q3 of this year, which is super exciting given the huge opportunity that provides as we look to a 2027 launch. Okay, let us unpack some of these trends on the next few slides.

On volume, I want to thank our team for getting us over 1 million units in a quarter. Natera, Inc. employees are very passionate about our mission to improve health, and it shows in our performance. Thank you for what you do every day. We fired on all cylinders in Q1 with another strong organ health quarter to go alongside record units in oncology and a very strong women’s health quarter. While we do expect Q1 to be strong due to seasonality, this was really an incredible quarter and nearly the most unit growth we have seen since I took over as CEO. We have seen a lot of new account momentum with the launch of Fetal Focus, as we will describe on the next slide. As a reminder, Fetal Focus is our next-generation single gene NIPT and it is powered by our ultrasensitive linked-SNP technology and enables direct assessment of fetal cell-free DNA across 21 genes associated with serious early-onset conditions.

We continue to see strong interest from clinicians, particularly given the test’s ability to address a common gap in prenatal care, specifically when paternal screening is not available. That demand is now transitioning into meaningful scale. As shown on the slide, we are approaching an annualized run rate of approximately 200 thousand test orders, reflecting strong adoption across OBGYNs and MFMs. For clarity, we do not count these Fetal Focus orders in our tests processed numbers when Horizon is negative for one of the 21 conditions tested. When we say we saw an incredible growth quarter, we are really referring to the core Horizon and Panorama testing and not including the majority of these Fetal Focus orders, which would boost our numbers even higher.

Importantly, this growth is supported by a strong clinical foundation. The EXPAND trial has been a major success and was selected for an oral plenary presentation at the Society of Maternal-Fetal Medicine meeting, a rare distinction that underscores both the quality of the data and its clinical relevance. As a reminder, the EXPAND trial is a prospective blinded multicenter study that has definitive genetic outcomes on all participants, both positives and negatives. The goal is to enroll about 2 thousand patients into the study, and this has been ongoing now for several years. The EXPAND results were recently submitted for peer-reviewed publication, and we believe we will continue to see Fetal Focus emerge as a meaningful contributor to growth in the women’s health business.

The next slide shows our clinical MRD volume progression over time. First, let us look at the total number of MRD tests. Getting nearly 250 thousand tests is an incredible number, and we are now on a run rate of over 1 million MRD tests annually. We were able to grow by approximately 24 thousand units in Q1, which was another record for our team. It is amazing to think we are still in the early stages of what MRD can become. In the volume, we are continuing to see strong growth in the core indications of colorectal and breast cancer while seeing increasing contributions from other cancer types. I would like to cover some of those growth drivers here on the next slide. The Q1 growth was a result of some major milestones in 2025, where we had a steady cadence of important data readouts and publications across uterine, breast, colorectal, and lymphoma.

A major highlight was our bladder cancer data being presented at ESMO and then being published in the New England Journal of Medicine. We are still seeing the impact of this data in our volumes, in bladder cancer and beyond, as it always takes time to see new data translate into real behavioral changes in the doctor’s office. In addition to the new data, we launched the integration with OncoEMR across their network of 4.5 thousand physicians, creating a much more seamless ordering experience. You will recall that we also expanded our commercial footprint last year, and I think we are seeing those reps start to contribute in a real way. We also differentiated our platform with the acquisition of Foresight Diagnostics. The Foresight integration is going well, and their deep research and clinical relationships have also been a tailwind for Signatera adoption in a clinical setting.

Many hematologists are starting to order Signatera MRD for their lymphoma patients, and the biopharma interest has really been picking up in both heme and solid tumors based on the value of the phased variant technology. We are pleased to see this working well thus far. We have also listed some of the wins from the first few months of the year on this slide, and we believe that will drive future MRD growth across tumor types. Solomon will discuss a few of these later in the call, including a recent dataset showing how Signatera may enable surgery avoidance as well as the exciting new data from the ALPHA3 trial. Okay, more detail on our revenue progression is here on the next slide. In addition to the strong volume growth, revenue growth is being amplified by realized average selling prices continuing to climb.

We spent a lot of time detailing all the hard work and investment we put into obtaining reimbursement for covered services, and those efforts continue to bear fruit. Unit ASPs were up across the board in women’s health and organ health, and Signatera ASPs reached another high, now at roughly $1,250. Mike will spend more time on this in his section. The second driver to realized pricing growth is worth watching as well. Even as women’s health continues to grow, the rapid expansion of organ health and oncology units being a contributing increasingly large share of total revenues, this trend is a further amplifier of revenue and gross margin growth in the future. As a reminder, in Signatera we have many histologies in submission to Medicare and are currently engaged in the standard cycle of coverage review, which represents additional ASP runway in the second half of this year.

As we talked about in the past, we previously set out a long-term Signatera ASP target of $2,000 per test. We think we are still on track to hit that goal as more private payers start to pay and a broader set of indications gets covered. Just at our current annualized volumes, a $2,000 ASP would generate an additional $750 million in revenue and gross profit per year. The next slide is our standard gross margin progression quarter by quarter going back two years. In addition to the ASP growth this quarter, COGS per unit in the lab were clean, largely holding steady with a very strong Q4 performance. Layered on top of these unit COGS were a couple of factors that we think are transient that impacted margin in the quarter, and without these, we would have been about 2% higher.

First, we took a larger than usual stock-based comp charge to COGS as part of the close of the Foresight acquisition in Q4. Second, a larger impact was just the amount of work in progress we held in the lab at March quarter-end. We only billed out recognized revenue on about 92% of our cases received in the quarter, while that ratio is normally 95% to 96%. Since we take cost charges as we use materials and labor to process cases in the lab, we have got a larger than usual bolus of cases hitting COGS but not revenue in the quarter. This happened because the volume coming into the lab was so high, particularly at the end of the quarter, which is, of course, a good sign for us. I expect this factor to normalize in the subsequent quarters. Mike will spend more time on these dynamics in his section, but we are sufficiently encouraged on gross margins to meaningfully raise the full-year guide.

With that, let me turn it over to Solomon to discuss more details from the quarter. Solomon?

Solomon Moshkevich: Thanks, Steve. In my section, I want to highlight several new sources of clinical and economic utility that we are observing with Signatera. There is a big new story emerging about the ability to use Signatera in certain patients to determine who might avoid surgery. On this slide, we have three examples where data was presented or published in the first quarter of the year showing that certain patients, if they test Signatera MRD negative, can forego surgery. In bladder cancer, data presented at the ASCO GU conference showed that Signatera MRD-negative patients who avoided cystectomy had similar outcomes as those who had the surgery. The investigators concluded that ctDNA-negative patients may avoid immediate cystectomy.

This is a huge deal, as bladder-sparing approaches are in extremely high demand due to the heavy impact on quality of life. In rectal cancer, a paper was published in the journal Cancers showing that after neoadjuvant therapy, Signatera MRD-negative patients who chose to avoid surgery had excellent outcomes. Again, sparing the rectum could have a huge impact on quality of life, so it looks like Signatera can really change the risk-benefit equation and potentially drive massive clinical and economic benefit. Finally, in breast cancer, a paper was published in Clinical Cancer Research showing that women 70+ with early-stage ER-positive disease who tested Signatera MRD negative at diagnosis were able to forego surgery and remain progression free.

The authors wrote that this can facilitate surgical de-escalation. The broader implication here is important. MRD testing is not only about finding recurrence earlier. It can also help avoid overtreatment, including major surgeries as well as systemic therapy. Physicians are very enthusiastic about this new data and the opportunity to de-escalate surgery, and as a reminder, Signatera is already covered by Medicare in all of these indications. We look forward to proving this out in other cancer types and continuing to build out the value proposition. Moving on now, I want to highlight the recently announced interim analysis from the ALPHA3 trial. Sponsored by Allogene Therapeutics, ALPHA3 is the first randomized study in large B-cell lymphoma to identify patients with positive MRD following frontline therapy and to intervene with an experimental second-line treatment while the disease burden remains low.

As shown on the slide, the data demonstrated a clear separation between the trial arms. MRD clearance was 58% in the treatment arm versus 17% in the observation arm, representing a 41-point absolute delta. We also observed quantitative molecular responses, with median ctDNA levels decreasing 98% from baseline in the treatment arm while increasing 27% in the observation arm. I will note that this interim futility analysis leveraged MRD clearance as an endpoint in addition to MRD status for patient enrollment. As a reminder, this trial was already underway when we acquired Foresight Diagnostics in December. On the basis of this positive readout, we congratulate our colleagues from Foresight and from Allogene. We look forward to completing the trial and hopefully enabling a valuable new therapy in the arsenal for patients with B-cell lymphoma.

With this data plus the 15 abstracts presented at the ASH conference, we are seeing a growing wave of interest from biopharma in hematology and beyond—an exciting time. While this trial drives treatment on MRD based on a single time point after the completion of first-line therapy, we are seeing the TOMER concept really take off across the board. INVIGOR011 was a TOMER trial as well, in that case with up to seven time points in the first year post-surgery. So it is worth spending a minute on the magnitude of the TOMER opportunity. Treatment on MRD creates a new paradigm, enabling both earlier, more aggressive interventions for patients destined to recur as well as deferred interventions for patients with low likelihood of recurrence. In the surveillance setting today, patients are usually monitored but not treated until recurrence is visible on a scan.

TOMER changes that by using MRD to trigger earlier treatment and intervention when disease is first detected in the blood, which is usually before it becomes detectable on a scan. We are seeing this idea play out in multiple pharma-sponsored trials, including ALPHA3 in lymphoma, STELLAR316 in colorectal cancer, TREAT-ctDNA and DARE in breast cancer, and INVIGOR011 in bladder cancer. We look forward to launching more of these. In the adjuvant setting, instead of treating all comers with systemic chemo or immunotherapy, TOMER allows MRD-negative patients to avoid potentially toxic therapy and continue surveillance. If they later become MRD positive, treatment can be escalated at that time. To that point, perhaps the most important finding from our perspective from the INVIGOR011 trial was that patients who delayed initiation of immunotherapy until they turned MRD positive enjoyed the same high level of therapeutic benefit as those who started immunotherapy right after surgery.

That unlocks a major sea change in how patients are treated. In INVIGOR011, 47% of patients were persistently MRD negative over the course of the first year and avoided adjuvant systemic therapy completely, achieving excellent long-term outcomes, including two-year overall survival of 97%. We estimate that a course of adjuvant immunotherapy can cost around $196 thousand per year, not to mention the cost of managing adverse events. So avoiding this cost in approximately half of bladder cancer patients can be extremely valuable to the patient and to the system. We think the value proposition in bladder cancer holds up even with the advent of new perioperative treatment approaches, like with EV+pembro, where many doctors are telling us that they will consider withholding the EV in patients who test MRD negative after surgery.

The EV component itself is estimated to cost over $100 thousand per patient and to be more toxic than pembrolizumab. We see a similar story playing out across disease types, with TOMER translating into meaningful clinical and economic utility. In colorectal cancer, for example, at least two different health economic studies have been presented in the past—one by a Blue Shield plan and one by a large private payer in the UK called Bupa—showing that MRD-guided treatment in stage II and III colorectal cancer can result in meaningful cost savings to the system ranging 21% to 43%. With that, I will turn it over to Alex to provide an outlook on upcoming data readouts and our launch in Japan. Alex?

Alexey Aleshin: Thanks, Solomon. Turning to ASCO this year, we have a powerful opportunity to reinforce Natera, Inc.’s leadership in MRD. The headline is clear: breadth, scale, and momentum. We will have 35 abstracts spanning TOMER, pan-cancer MRD, phased variant technology, real-world evidence, and trials in progress. That level of output matters because it shows Signatera is not a single tumor, single use case, or single study story. We are building the evidence base for MRD across the full oncology landscape and doing it at a scale that we believe is unmatched. The presentation I would highlight is the pan-cancer MRD meta-analysis. This is an important step forward because it moves the discussion beyond individual tumor-type wins to a broader platform-level statement.

Across 18 published studies, more than 3 thousand patients, and 15 solid tumor types, ctDNA positivity was strongly associated with recurrence risk in both the MRD window and surveillance settings. These data reinforce the clinical relevance of tumor-informed ctDNA across cancers and support the idea that MRD is becoming a foundational tool in oncology. That message is also reflected across the broader ASCO program. We will be presenting data in colorectal cancer, bladder, breast, lung, lymphoma, melanoma, ovarian, uterine, sarcoma, and other tumor types, showing the expanding role of Signatera across settings from adjuvant decision-making to surveillance, treatment response monitoring, and treatment on molecular recurrence. The TOMER data are particularly exciting because they point to where oncology is heading—moving from reactive treatment after radiological relapse to earlier, more precise interventions at the molecular recurrence stage.

And our phased variant technology presentations in lung cancer and lymphoma further highlight how our technology platform continues to advance, pushing sensitivity in settings where detection is especially challenging. Together, these data reinforce three core messages: Signatera is broadly clinically actionable today; our technology platform continues to advance; and our evidence generation engine is operating at unmatched scale. Looking at the next slide, it is remarkable to see how we have continued to launch important trials that we believe deliver compelling data to advance MRD testing in breast cancer. What you are seeing here is the scale and depth of the clinical work we have built spanning every stage of disease from early to metastatic.

We have continued to expand our evidence base with 22 peer-reviewed publications and 84 presentations at leading medical meetings, reflecting both the momentum and growing interest from the clinical community. At the same time, we continue to advance our prospective trial pipeline with high-impact studies across multiple settings, including interventional randomized studies like SAFE-D, DARE, and HEROES, each answering an important question—including de-escalation, TOMER, and treatment optimization in exceptional responders, respectively. And underpinning all of this is a substantial investment now exceeding over $250 million in breast cancer trials alone, reflecting both the opportunity we see and the barrier to entry it creates for others trying to build a comparable dataset.

So when you zoom out, the breast cancer program is really strong, and we look forward to announcing additional game-changing trials in the near future. We are expanding the evidence base, deepening clinical utility, and investing ahead of what we believe will be long-term adoption. Now I want to talk about two major areas of upside for Natera, Inc.: early cancer detection and the Japan Signatera launch. First, turning to early cancer detection. FIND CRC is one of the most exciting milestones ahead for Natera, Inc. This is our FDA-enabling colorectal cancer screening study targeting approximately 25 thousand to 40 thousand average-risk adults, including about 70 CRC cases and roughly 1.4 thousand advanced adenomas. Enrollment is progressing above plan, and we are now on pace to complete enrollment for the PMA submission in Q3 2026, supporting the path forward for an FDA PMA readout in 2027.

What makes this especially compelling is that we are not starting from a blank slate. In FORESITE CRC, a prospectively enrolled study of average-risk asymptomatic participants, we previously demonstrated 22.5% sensitivity for advanced adenomas at 91.5% specificity. That is important because these were not easy-to-detect lesions. Nearly all were under 30 millimeters, and more than 90% were under 20 millimeters. In other words, we are seeing encouraging performance in exactly the kind of challenging precancerous lesions where blood-based screening has historically struggled. That matters because the biggest opportunity in colorectal cancer screening is not just finding cancer earlier; it is helping prevent cancer by detecting advanced adenomas before they progress.

This is where we believe Natera, Inc. can be differentiated. And strategically, CRC screening is only the first step. As we advance FIND CRC, we are also building the foundation for a broader early detection platform, including development of a multi-cancer early detection assay. So, again, we are ahead of plan here with trial enrollment. Finally, a note about the outlook for our launch in Japan. Japan is one of the most exciting near-term growth opportunities for Signatera and, importantly, it has the potential to become a meaningful volume accelerator. PMDA approval remains on track for Q2 2026, and commercial launch preparations are advancing for a broad commercial launch shortly after. The CRC opportunity alone is significant. Japan has a similar absolute number of colorectal cancer diagnoses as the United States, and we estimate that a launch could effectively double Signatera’s annual CRC volume TAM.

Over time, expansion into additional histologies could make Japan a broader platform market, with MIBC submission being the next prioritized use case given the INVIGOR011 data. What gives us confidence is that the market is already being seeded. Through CIRCULATE-Japan and GALAXY, Signatera has been used across more than 150 institutions, giving hundreds of oncologists firsthand experience before commercialization. In addition, both JASMO and JASCO have issued supportive clinical practice guidelines for MRD testing, creating a favorable clinical backdrop for adoption. That familiarity could help volumes ramp faster than our base-case assumption. Japan’s structure also supports rapid adoption. With a single national payer, one positive reimbursement decision can open broad access across the country.

So the message is clear: Japan can be a step-change opportunity, expanding our global MRD market, accelerating commercial volumes, and reinforcing Natera, Inc.’s leadership worldwide. With that, let me turn it over to Mike to review the financials. Mike?

Michael Brophy: Great. Thanks, Alex. The next page is just a summary of the financials compared to last year. On revenues, we had another good quarter of sequential ASP progress across the board. We had about $60 million in revenue growth this quarter, in line with Q4 and, of course, smaller as a percentage of revenue compared to Q4. Given the longer history we now have with improved realized pricing, we took a modestly more aggressive approach with accruing higher prices for selected payers and products that have strong payment track records. This is just an incremental shift from our historical approach, and we will continue to turn the dial on ASPs if the cash receipts continue to exceed our expectations. Signatera ASPs are now roughly at $1,250 as Steve described.

We achieved that just by continuing to execute our playbook of driving better alignment with the smaller Medicare Advantage plans and grinding out more consistent reimbursement for covered services in the biomarker states. In addition to those factors, we got a bump from the improved bundled pricing CMS announced at the beginning of the year, which has more than offset the modest decline in ADLT rates we spoke about on the November call. While the new bundled pricing is fully reflected in the revenue results, that change in the bundled pricing actually caused a temporary delay in cash for Signatera, as we had to take some time to update our list pricing for each covered tumor type, reload each bundled price back into the system with all of our payers, and revalidate the engineering.

So that caused a modest step up in DSOs this quarter. We have now gotten the new prices largely loaded in and have seen the delayed cash arrive in April, so collections for Signatera are back on track. Okay, good. Let us get to the guide on the next slide. We are really pleased with the start to the year and happy to be completely resetting the revenue guide up $120 million at the midpoint. The guide is a lot higher, and the underlying drivers look achievable to us at this point in the year. On volumes, we continue to expect quarterly growth in Signatera along the lines of the trailing twelve-month average as we have described in the past, and we expect to see organ health continue to grow on its current trend line. The revenue guide also bakes in the seasonality in volumes typically seen in women’s health, where Q1 is our strongest quarter, Q2 the slowest, and then we see recovery in the second half of the year.

As Steve mentioned, we have got a pathway to continue grinding ASPs higher. For example, the original guide contemplated getting $50 in ASP gains on Signatera this year. The new revenue guide implies we anticipate exiting 2026 at roughly $1,275, and, of course, we are pushing to be higher than that. There is significant opportunity among the private payers and from expanding Medicare coverage to new indications. I think we can get to the $1,275 ASP without additional coverage decisions, so these would be upside to our guide. Steve covered gross margins in some detail in his section, but I would just reiterate that we are feeling good given the per-unit COGS we saw in Q1. We should have some tailwind in the send-to-receive ratio in the next few quarters.

Given those factors, current ASP trends, and the Q1 actuals baked into the annual number, we think resetting the midpoint at 65% still leaves room for upside as we progress through the year. As a reminder, when guiding to future periods, we do not include the impact of revenue true-ups, so those would represent further upside to the guide. On OpEx, we are holding SG&A steady as planned in March. We are pleased with the progress so far with all the growth initiatives we have in place in sales and marketing and continue to get scale in our operations that are not needing to grow anywhere near as fast as revenue. We have deployed a significant amount of AI capability around the business in the last year, and I think we are well positioned to drive more efficiency over the near term.

On R&D, I am pleased to see the FIND study progressing faster than expected, and we have been very glad to invest in more clinical trials for Signatera that have become available to us just this spring. We have a long track record of generating high ROICs in our R&D effort, and our plan is to stay ambitious to maintain our leadership position across the portfolio. Okay, and with that, let me open it up to questions.

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Operator: Thank you. We will now open the call for questions. If you have dialed in and would like to ask a question, please press 1 on your telephone keypad to raise your hand and join the queue. If you are called upon to ask your question and are listening via speakerphone on your device, please pick up your handset and ensure that your phone is not on mute when asking your questions. Again, it is 1 to join the queue. Our first question comes from the line of Douglas Anthony Schenkel with Wolfe Research. Your line is open.

Douglas Anthony Schenkel: Good afternoon, and thank you for taking my questions. I will keep them to two, and they are both financial. First, on gross margin, you had a really nice quarter even normalized for catch-ups. You bumped up full-year guidance by about a point. That said, it does seem like you could have gone further than that. Are you holding back largely because of things like MRD mix and trying to get a better handle on how that is going to play out given it is only May? Second, on spending, specific to the SG&A line, it jumped up a bit as a percentage of sales relative to what we saw in the fourth quarter. Were there any timing dynamics or things that you would consider one-timers that we should contemplate as we evaluate spending discipline in the quarter and update our models? Thank you.

Michael Brophy: Hey, Doug. Thanks for the questions. On gross margins, I think this is just a philosophical point with respect to our guide. We do feel biased towards the upside as it relates to our gross margin trajectory through the course of the year, but we are always looking out for those potential risk factors to gross margin. As we talked about in the prepared remarks, if you dial down to the unit economics—strip out the Foresight equity and things like that we paid out as part of the deal—and just look at cost per unit and ASPs, those are looking really clean. I laid out in my section a couple of the drivers for ASPs going forward, particularly related to Signatera, which we are excited about. We did not include all of the potential drivers in the guide, so I agree there could be upside there.

On SG&A, Q1 is often elevated as it relates to sales and marketing expenses. We had a number of those in the quarter that do not repeat. We had a couple of true one-timers related to balance sheet adjustments that related to non-cash charges in the quarter. I am roughly estimating those were worth about $25 million just in the quarter. When you back that out and normalize that, that is what gives me confidence around the SG&A guide for the rest of the year. Just a general comment on OpEx generally is that our posture is to marry up the spending discipline that we have talked about, while still remaining opportunistic, recognizing that we have got a huge growth runway ahead of us. If these higher ROIC opportunities come in the door, we are not going to hesitate—we are going to keep our foot on the gas and be aggressive to ensure we maintain leadership across all these businesses.

Operator: Our next question comes from the line of Daniel Gregory Brennan with TD Cowen.

Daniel Gregory Brennan: Great. Thanks for the questions. Maybe first one is just on volumes. Steve, I think you called out this idea that 92% of tests got recognized in the quarter, atypical versus 95% to 96%. How unusual is that? If you just apply 95% to 96% this quarter, that would be like another 10 thousand tests—maybe a real Signatera blowout. Is that factored into Q2? Should we see a big bump there? And then the second question is just related to MolDx. You called out again the opportunity there. What is the latest thinking on pan-cancer potential? Is that something we could potentially see this year or next year, or do you think it is going to be single cancer by single cancer?

Steven Leonard Chapman: Thanks. I will take the MolDx comment, and then Mike can talk about the received-to-reported ratio, which should be more favorable in Q2. We are feeling really good. We said previously we have something like seven additional histologies or submissions that are in, and those went in right around Q4. We have already had one round of back and forth with MolDx on those, and these are all following the standard process that we have seen, so we are feeling positive. These in submission right now would make up the vast majority of the remaining non-covered business for us, and as we said, that would have a value in a similar range to what you have outlined. It could be very meaningful for us, both from getting the Medicare payment and also now with commercial payers starting to slowly comply with the biomarker state laws.

Ultimately, we do think we are on a trajectory to get to around a $2,000 ASP, and if you just multiply that by our volume today, that would be worth something like $750 million in revenue and margin. We are working on those paths to unlock.

Michael Brophy: Send-to-receive is usually about 95% to 96%. It is not at all unusual to have a very high ratio in Q4 and a low ratio in Q1—that is actually kind of our typical experience. The factor is similar to what Steve described in the prepared remarks. When the women’s health business is rocking like it did in Q1, that is just a very high-volume enterprise at this point. If you bring in a ton of units in the last week or two of the quarter, you are going to end the quarter with a lot of units in process that have not been reported out yet. We have to take the COGS as they come in the lab, so we are taking COGS on most of those units, but we cannot recognize revenue until they are reported out. It is a work-in-process transient issue, and I expect it to normalize over subsequent quarters.

I think that was about a 1.5% plus gross margin headwind in the quarter which, spread out over the balance of the year, is another factor that gives us confidence in bumping the gross margin guide at this point.

Operator: And our next question comes from the line of Tycho W. Peterson with Jefferies. Your line is open.

Tycho W. Peterson: One on Fetal Focus—did you notice any specific share trends relative to the broader market for this quarter? What are you seeing in terms of pricing pressure or competitive intensity in core women’s health overall? And then the second question is around Latitude. Following the CRC data in January, you talked about additional tumor types. Have you worked out what that looks like later this year? And in terms of the reflex testing strategy, how frequently now is Latitude being used as a reflex when tissue is insufficient, and how do you see the Latitude volumes in the long term working out this year?

Steven Leonard Chapman: Thanks. On Fetal Focus, we feel very good, very positive both on the quality of the data and the volume that we are seeing. We had a very strong Q1 in women’s health. We said it was the second-highest number of units that we have added sequentially between Q4 and Q1 since I took over as CEO. We added 63 thousand units in women’s health just between 2025 and 2026. We think this compares very favorably when we look at others in the women’s health field. On Latitude, we are doing very well with the CRC rollout and seeing a lot of interest from physicians. We think the majority of physicians prefer the tumor-informed products, but in the limited cases where they are not able to get tissue, it is great that we have Latitude available.

We have had a lot of great data come out there. Physicians are happy with the product. We are in a position now to reflex pretty quickly in a setting where the tissue becomes not available. We have built this technology platform that allows us to expand beyond CRC to other histologies, and we will be doing that in the future, and we will give you updates as that progresses.

Operator: And our next question comes from the line of Analyst with Citi. Your line is open.

Analyst: Hey, guys. Thank you for taking the question. On the Signatera side, nice to see the sequential build. You have talked about looking at the trailing four quarters on the build. Can you talk about the momentum you saw throughout the quarter and the right way to think about that build going forward as that number continues to step up every quarter?

Steven Leonard Chapman: Thanks a lot. What we have seen in Signatera is consistent growth in new patients, and that continued very strongly throughout the end of the quarter, which is a positive sign. We also look at patients that are on surveillance and repeat rates; that also continues to be strong. There are a couple of dynamics now that are driving growth in the business. First, doctors that have used the product become more comfortable with it and start to expand their usage. That can be either deeper within a histology—for example, within colorectal—or expanding laterally to other histologies within their practice. Second is new customers that have never tried Signatera before. Our latest update previously indicated something like 45% to 50% of oncologists had tried Signatera in the quarter.

That means there is still about half that have not, and we are targeting that half. Every quarter, we are seeing more and more doctors use the test. As more data comes out—we had several slides on the strength of the data in Q4 and the beginning of Q1—that drives both new customers and expansion within accounts. Roughly 250 thousand tests is a lot of tests, and we are feeling really good about the impact we are making on patient care, but it is also just the beginning. We have invested in clinical trials and product enhancements. We have some exciting things coming out at ASCO and some exciting technology advancements launching later this year, and we are in a very good position.

Operator: And our next question comes from the line of Subhalaxmi Nambi with Guggenheim.

Subhalaxmi Nambi: I have just one. One of the leading players in the rare disease market has had challenges with reimbursement and mix. Is this dynamic relevant for you? And bigger picture, how is Zenith ramping, and how are you differentiating there? Should we expect data readout end of this year, or would that be early next year?

Steven Leonard Chapman: Thanks a lot. We launched our rare disease product called Zenith. It is going really well so far. Volumes are relatively low at this early stage in the launch, but we feel really good about the product offering and the feedback we have gotten from physicians. We are not really impacted by the dynamics that others have highlighted because we are pretty early on, so it is all upside to us at this point. There is a lot of opportunity there, and it is a new growth factor for us. Another one that is really near term and very large is early cancer detection for CRC. Alex talked about that a little bit in the prepared remarks, but we are going to be done with the trial in a couple of months, and that is going to put us in a great position to commercialize in the near future and be submitting to FDA in 2027. The PMA data will be read out from the definitive trial in 2027.

Operator: And our next question comes from the line of Analyst with Evercore ISI. Your line is open.

Analyst: Hi, guys. This is Mackenzie on for Daniel. Thanks for taking my questions. Could you talk a little bit more about the CRC launch in Japan? It sounds like that could come in the back half of this year. Can you talk about visibility to adoption and what that ramp might look like? And then can you give us an update on any momentum or other developments in the biomarker states?

Steven Leonard Chapman: That sounds good. I want to clarify one thing I mentioned earlier too. On women’s health, we grew 63 thousand units quarter over quarter from Q4 2025 to Q1 2026, and that really does not count Fetal Focus orders that we have received. Only a couple of thousand Fetal Focus orders are counted in that number. The vast majority of that 63 thousand are just Panorama and Horizon orders, because if Horizon is negative and Fetal Focus is ordered, we do not actually count that in our numbers. We could be counting the growth as a number that is much higher, but that 63 thousand is really just the core women’s health business—Panorama and Horizon—growing between Q4 2025 and Q1 2026, which we think is very significant, especially when you look at the competitive readouts that have come over the last couple of days in the women’s health space.

On Japan, Japan has the same number of CRC diagnoses per year as what we see in the United States. We have been waiting to be in this position where we will have regulatory approval, reimbursement, and our commercial launch, and now all that is happening. I think we are less than six months away from that and being off to the races in Japan. We have had a lot of really good conversations, and things are on track. Initially, the goal is to have that initial time point covered and then move on, and down the road get surveillance covered and be off to the races.

Solomon Moshkevich: This is Solomon. Two elements here. Given MRD already being recommended in several major Japanese guidelines, we do expect pretty significant adoption post approval and post reimbursement. It is hard to say exactly right now what the units might look like; we will provide that in the future as we tighten up the models. On the pricing side, there is strong health economic rationale in addition to clinical rationale, so we think we are in a good position to negotiate solid pricing with the Japanese ministry. That would happen post regulatory approval, so sequentially. We will provide updates on that once we have clarity towards the end of the year ahead of our launch. We are really looking forward to making a big impact and helping CRC patients in Japan. Regarding biomarker states, we continue to see gradual improvement as commercial payers begin to comply with the laws, which we believe will support ongoing ASP progress for covered services.

Operator: And our next question comes from the line of Analyst with Morgan Stanley.

Analyst: Mike, could you help us understand how the cost ramp could look for the screening asset—between R&D and the commercial costs down the line too? It is a different cost profile to the core business, but help us split the two and how we could expect that to shape through 2026 and beyond. And then on Signatera, can you talk through what momentum you are seeing in terms of same-store sales versus new additions—depth versus breadth?

Michael Brophy: Got it. There are two components to the cost for the ECD launch. One, you have the R&D cost associated with the FIND trial; and second, you have commercialization and launch costs, which would be SG&A. For the FIND trial itself, we are way down the path now. You heard the update about how close we are to completing enrollment, and then we have to make the spend to run the samples. That, we think, is largely reflected now in the guide. We bumped the guide in R&D this quarter specifically because the ramp of enrollment was much quicker than anticipated, which is a great sign. Beyond that, on R&D, the only variable would be if there are additional things we can do to further accelerate; we will be opportunistic.

A lot of that spend will be incurred this year and perhaps early next year in terms of running the samples, within the context of our normal R&D budgeting. On the commercialization front, we feel like we have good channels to leverage in the commercialization of the assay. In terms of building out a larger commercial channel specific to primary care, we will leg into this—build incrementally as we deliver volume. Our experience in the primary care call point via the OB/GYN channel gives us a ton of experience in terms of understanding where to build first, and we will build on top of that sales team on the back of success, the same way we did in women’s health and then in oncology. On Signatera depth versus breadth, we are seeing healthy same-account expansion as clinicians increase use by indication and by cadence, alongside steady growth in new ordering accounts, so both vectors are contributing.

Operator: And our next question comes from the line of Casey Woodring with JPMorgan. Your line is open.

Casey Woodring: Thanks for taking my questions. Steve, you mentioned in your prepared remarks that you are seeing the reps that you added last year start to contribute to MRD growth in a real way. Where are you with getting that cohort of new MRD reps up to speed and fully productive, and how much more runway is there for Signatera growth from those reps ramping?

Steven Leonard Chapman: I would say we are probably between 50% and 75% ramped. They are really starting to become productive mid and through Q1 and turning the quarter into Q2, so there is still a little bit more juice to squeeze there. That is contributing to targeting new customers and helping with cross-selling, with some specialization on some of those reps. We are also investing in medical education and that is going well. We had record numbers and continue to see very strong growth leaving the quarter—we are seeing the same strong trajectory. Also, a lot of growth is starting to come from new areas like lymphoma, for example, which is a big market that by itself would be its own company—and we have many of those. As those start to get going and the flywheel turns, there are bigger opportunities.

The other thing I will mention is initiatives within pharma. Some of the reps that we added are focusing on Natera, Inc.’s data business, where we have a unique capability; reps focusing on our AI tools, where we have a unique capability that nobody else can touch; or reps focusing on our pharma sales in oncology. We are seeing an incredible amount of momentum there. There has been hiring there, and they are starting to hit their stride. You can expect to hear more as that continues. There is tons of interest, expanded by the acquisition of Foresight and the extreme ultrasensitive levels we are getting with the phased variant technology, so that is another area of excitement.

Operator: Our next question comes from the line of Catherine Schulte with Baird.

Catherine Schulte: Maybe first, we have heard some others in the space calling out weather as an impact in the quarter. Clearly, volumes were very strong for you, but did you see any winter storm impact? And then for Signatera, what portion of patients would you say are adhering to the surveillance schedule that you have laid out? Is there some untapped utilization there in the surveillance setting?

Steven Leonard Chapman: Good question. We did see impact from storms that hit in January. There was a step down in units and we tried hard to recover a lot of those, but we were not able to get the full recovery. Despite having a record quarter across the board and record growth in oncology, it would have been much faster had we not had those storms, but we did not call it out because we did so well despite them. On surveillance adherence, we have seen pretty consistent usage over time. It depends how many years out the patient is. In colorectal, a common protocol is four times a year for the first year and then two times a year thereafter, mirroring CEA. Not everybody stays on that, as some patients recur, unfortunately some pass away, or some feel they have moved on and do not want continued monitoring.

We do see good adherence and we always try to increase it. Some doctors do not believe in surveillance yet—that is an upside opportunity for us as more data comes out. Many do believe in it and try hard to keep their patients on a consistent protocol, and that is a big reason you are seeing the growth.

Operator: And our next question comes from the line of Puneet Souda with Leerink Partners.

Puneet Souda: First on prior authorization—there has been some news lately from CMS and some larger payers on prior authorization. How often do you see prior authorizations on Signatera or other products, and to what extent do you think payers reducing prior authorization would be a tailwind for you this year? And then on Foresight, are you launching any Signatera with phased variants yet in the clinic? Any reception or feedback?

Steven Leonard Chapman: On prior auth, that has definitely been a tool that payers have used to not pay even for covered services. Any action that limits prior auth for covered services is going to help our ASPs, so we commend strategies to make access to care easier for covered services. We do think that is an upside opportunity for us. On Foresight performance and phased variants, I will let Solomon jump in.

Solomon Moshkevich: We are planning to launch an updated version of the Signatera genome-based assay that will include phased variants later this year. It is already available in the research setting for pharma and for academic researchers. That has driven a lot of excitement and additional conversations. We already have at least one more major pharma-sponsored trial contracted leveraging that capability. On the clinical side, I do not think this is holding anyone back. Especially hematologists treating patients with lymphoma are excited to be able to order Signatera for their patients. We showed strong data at ASH in December on the performance of the current Signatera assay for patients with lymphoma, and together with our partnership with Foresight and their reputation in that setting, we have already seen an inflection in willingness and enthusiasm to order MRD for those patients, especially given that it is in guidelines. We are feeling good about this area.

Operator: And looks like we lost our caller. Ladies and gentlemen, that will conclude our question and answer session and today’s call. We thank you for your participation, and you may now disconnect.

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