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What changed in Natera, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Natera, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+402 added−422 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in Natera, Inc.'s 2025 10-K

402 paragraphs added · 422 removed · 332 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

123 edited+38 added−54 removed182 unchanged
Biggest changeAs a business that operates both internationally and throughout the United States, any unauthorized use or disclosure of personal information, even if it does not constitute PHI, by us or our third-party contractors, including disclosure due to data theft or unauthorized access to our or our third-party contractors’ computer networks, could subject us to costs, fines or penalties that could adversely affect our business and results of operations, including the cost of providing notice, credit monitoring and identity theft prevention services to affected consumers.
Biggest changeIn addition, private litigation related to processing of personal information brought by classes of data subjects, or by consumer protection organizations representing their interests, have increased in recent years. ​ 24 Table of Contents As a business that operates both internationally and throughout the United States, any actual or perceived failure to comply with privacy obligations, including unauthorized use or disclosure of personal information, even if it does not constitute PHI, by us or our third-party contractors, including disclosure due to data theft or unauthorized access to our or our third-party contractors’ computer networks, could lead to regulatory investigations or actions; litigation (including class claims) and mass arbitration demands; fines and penalties; disruptions to our business operations; reputational harm; loss of revenue, customers or sales; and other adverse business consequences.
Item 1. BUSINESS Note: A glossary of terms used in this Form 10-K appears at the end of this Item 1. Overview We are a diagnostics company with proprietary molecular and bioinformatics technology that we are applying to change the management of disease worldwide.
Item 1. BUSINESS Note: A glossary of terms used in this Form 10-K appears at the end of this Item 1. Overview We are a diagnostics company with proprietary molecular and bioinformatics technology that we are applying to change disease management worldwide.
Our Solution In women’s health, oncology and organ health, the use of blood-based tests offers significant advantages over older and more invasive methods, but the significant technological challenge is that such testing often requires the measurement of very small amounts of relevant genetic material – fetal DNA in reproductive health, tumor DNA in oncology, and donor DNA in transplant rejection – circulating within a much larger blood sample.
Our Solution In oncology, women’s health, and organ health, the use of blood-based tests offers significant advantages over older and more invasive methods, but the significant technological challenge is that such testing often requires the measurement of very small amounts of relevant genetic material – tumor DNA in oncology, fetal DNA in reproductive health, and donor DNA in transplant rejection – circulating within a much larger blood sample.
Our approach combines proprietary molecular biology and computational techniques to measure genomic variations in tiny amounts of DNA, as small as a single cell. Our core technology has, to date, been proven across these three diverse fields of women’s health, oncology and organ health. DNA is the molecule that carries genetic information in an organism.
Our approach combines proprietary molecular biology and computational techniques to measure genomic variations in tiny amounts of DNA, as small as a single cell. Our core technology has, to date, been proven across these three diverse fields of oncology, women’s health, and organ health. DNA is the molecule that carries genetic information in an organism.
Furthermore, our tests can be applied to assess a range of conditions and disease types, including common fetal aneuploidies, microdeletions, triploidy, and inherited genetic conditions that could be passed on from parent to child; a broad range of cancer types; rejection of heart, lung, and kidney transplants; and genetic bases of kidney disease.
Furthermore, our tests can be applied to assess a range of conditions and disease types, including a broad range of cancer types; common fetal aneuploidies, microdeletions, triploidy, and inherited genetic conditions that could be passed on from parent to child; rejection of heart, lung, and kidney transplants; and genetic bases of kidney disease.
The SMART study, published in the American Journal of Obstetrics and Gynecology , evaluated the performance of cfDNA screening for aneuploidies T21, T18 and T13 as well as for 22q11.2 by tracking birth outcomes in the general population among women who presented clinically and elected Panorama microdeletions and aneuploidy screening as part of their routine care.
The SMART study, published in the American Journal of Obstetrics and Gynecology , evaluated the performance of cfDNA screening for aneuploidies T21, T18 and T13, as well as 22q11.2 by tracking birth outcomes in the general population among women who presented clinically and elected Panorama microdeletions and aneuploidy screening as part of their routine care.
Our competitors in the NIPT space include Laboratory Corporation of America Holdings, or Labcorp; Myriad Genetics, Inc.; Quest Diagnostics Incorporated, or Quest; Illumina, through its subsidiary Verinata; BillionToOne Inc.; BGI; Fulgent Genetics; and Revvity Inc. We also compete against companies providing carrier screening tests such as Labcorp; Myriad Genetics, Inc.; Fulgent Genetics; BillionToOne Inc.; and Quest.
Our competitors in the NIPT space include BGI; BillionToOne Inc.; Fulgent Genetics; Illumina, through its subsidiary Verinata; Laboratory Corporation of America Holdings, or Labcorp; Myriad Genetics, Inc.; Quest Diagnostics Incorporated, or Quest; and Revvity Inc. We also compete against companies providing carrier screening tests such as BillionToOne Inc.; Fulgent Genetics; Labcorp; Myriad Genetics, Inc.; and Quest.
California Laboratory Licensing In addition to federal certification requirements for laboratories under CLIA, we are required under California law to maintain a California state license for both our San Carlos, California and Austin, Texas clinical laboratories, and to comply with California state laboratory laws and regulations, because our San Carlos facility is located in, and both facilities test specimens originating from, California.
California Laboratory Licensing In addition to federal certification requirements for laboratories under CLIA, we are required under California law to maintain a California state license for our San Carlos, California and Austin, Texas clinical laboratories, and to comply with California state laboratory laws and regulations, because our San Carlos facility is located in, and both facilities test specimens originating from, California.
New York Laboratory Licensing Because we test specimens in both our Austin, Texas and San Carlos, California laboratories originating from, and return test results to, New York State, both of our laboratories are required to obtain a New York State laboratory permit and comply with New York State laboratory laws and regulations.
New York Laboratory Licensing Because we test specimens in our Austin, Texas and San Carlos, California laboratories originating from, and return test results to, New York State, both of our laboratories are required to obtain a New York State laboratory permit and comply with New York State laboratory laws and regulations.
Our cell-free DNA, or cfDNA, technology combines our novel molecular assays, which reliably measure many informative regions across the genome from samples as small as a single cell, with our statistical algorithms which incorporate data available from the broader scientific community to identify genetic variations covering a wide range of serious conditions with high accuracy and coverage.
Our cell-free DNA, or cfDNA, technology combines our novel molecular assays, which reliably measure many informative regions across the genome from samples as small as a single cell, with our statistical algorithms that incorporate data available from the broader scientific community to identify genetic variations covering a wide range of serious conditions with high accuracy and coverage.
We believe the principal competitive factors in our molecular diagnostic testing markets include the following: ● test performance, as demonstrated in clinical and analytical studies and clinical trials as well as in commercial experience; ​ 14 Table of Contents ● comprehensiveness of coverage and ease of use, including user experience for both patients and providers; ​ ● value of product offerings, including pricing and impact on other healthcare spending; ​ ● scope and extent of reimbursement and payer coverage; ​ ● effectiveness of sales and marketing efforts; ​ ● breadth of distribution of products and partnership base; ​ ● reputation among patients and providers for development and introduction of new, innovative products; ​ ● operational execution, including test turn-around time and test failures; ​ ● key opinion leader support; and ​ ● brand awareness.
We believe the principal competitive factors in our molecular diagnostic testing markets include the following: ● test performance, as demonstrated in clinical and analytical studies and clinical trials as well as in commercial experience; ​ ● comprehensiveness of coverage and ease of use, including user experience for both patients and providers; ​ ● value of product offerings, including pricing and impact on other healthcare spending; ​ ● scope and extent of reimbursement and payer coverage; ​ ● effectiveness of sales and marketing efforts; ​ ● breadth of distribution of products and partnership base; ​ ● reputation among patients and providers for development and introduction of new, innovative products; ​ ● operational execution, including test turn-around time and test failures; ​ ● key opinion leader support; and 15 Table of Contents ​ ● brand awareness.
We aim to make personalized genetic testing and diagnostics part of the standard of care to protect health and inform earlier and more targeted interventions that help lead to longer, healthier lives. ​ We focus on applying our technology to three main areas of healthcare – women’s health, oncology and organ health.
We aim to make personalized genetic testing and diagnostics part of the standard of care to protect health and inform earlier and provide more targeted interventions that help lead to longer, healthier lives. ​ We focus on applying our technology to three main areas of healthcare – oncology, women’s health, and organ health.
Panorama also screens for five of the most common genetic diseases caused by microdeletions – 22q11.2 deletion syndrome (DiGeorge syndrome), 1p36 deletion, Angelman syndrome, Cri-du-chat syndrome and Prader-Willi syndrome. Diseases caused by microdeletions are often not detected via common screening techniques such as ultrasound or hormone-based screening, yet the presence of a microdeletion can critically impact postnatal treatment.
Panorama also screens for five of the most common genetic diseases caused by microdeletions – 22q11.2 deletion syndrome (DiGeorge syndrome), 1p36 deletion, Angelman syndrome, Cri-du-chat syndrome and Prader-Willi syndrome. Diseases caused by microdeletions are often not detected via common screening techniques such as ultrasound or hormone-based screening, yet the presence of a microdeletion can impact prenatal and postnatal treatment.
Most commercial health insurers, as well as an increasing number of state Medicaid programs, have a positive coverage determination for NIPT for average-risk pregnancies. As of December 31, 2024, we and our laboratory distribution partners had in-network contracts with health plans that accounted for close to 250 million covered lives in the United States.
Most commercial health insurers, as well as an increasing number of state Medicaid programs, have a positive coverage determination for NIPT for average-risk pregnancies. As of December 31, 2025, we and our laboratory distribution partners had in-network contracts with health plans that accounted for close to 250 million covered lives in the United States.
As discussed in more detail in “ Risk Factors—Reimbursement and Regulatory Risks Related to our Business—If the validity of an informed consent from a patient intake for Panorama or our other tests is challenged, we could be precluded from billing for such testing, forced to stop performing such tests, or required to repay amounts previously received, which would adversely affect our business and financial results ,” while we rely on physicians to obtain the required patient consent to perform genetic testing, the regulatory burden may be deemed to be our responsibility and such consents, or our compliance with applicable 21 Table of Contents laws and regulations, could be challenged.
As discussed in more detail in “ Risk Factors—Reimbursement and Regulatory Risks Related to our Business—If the validity of an informed consent from a patient intake for Panorama or our other tests is challenged, we could be precluded from billing for such testing, forced to stop performing such tests, or required to repay amounts previously received, which would adversely affect our business and financial results ,” while we rely on physicians to obtain the required patient consent to perform genetic testing, the regulatory burden may be deemed to be our responsibility and such consents, or our compliance with applicable laws and regulations, could be challenged.
CLIA certification is also a prerequisite to be eligible to bill state and federal health care programs, as well as many commercial third-party payers, for laboratory testing services. Our laboratories located in Austin, Texas and in San Carlos, California are CLIA certified, and must comply with all applicable CLIA regulations and standards.
CLIA certification is also a prerequisite to be eligible to bill state and federal health care programs, as well as many commercial third-party payers, for laboratory testing services. Our laboratories located in Austin, Texas; San Carlos, California; and Boulder, Colorado are CLIA certified, and must comply with all applicable CLIA regulations and standards.
Violation of the federal False Claims Act may result in fines of up to three times the actual damages sustained by the government, plus mandatory civil penalties – up to approximately $28,619 in 2024 – per false claim or statement, imprisonment or both, reimbursement of the whistleblower’s attorneys’ fees, and possible exclusion from any federal health care programs.
Violation of the federal False Claims Act may result in fines of up to three times the actual damages sustained by the government, plus mandatory civil penalties – up to approximately $28,619 in 2025 – per false claim or statement, imprisonment or both, reimbursement of the whistleblower’s attorneys’ fees, and possible exclusion from any federal health care programs.
Accordingly, we are required under PAMA to report to CMS the private payment rates and volume of our tests which are covered under Medicare Part B; however, the PAMA reporting requirements were suspended in 2021 and have continued to be delayed, most recently until 2026, which in turn has not resulted in rate reductions under the Medicare Part B CLFS.
Accordingly, we are required under PAMA to report to CMS the private payment rates and volume of our tests which are covered under Medicare Part B; however, the PAMA reporting requirements were suspended in 2021 and have continued to be delayed, most recently until 2027, which in turn has not resulted in rate reductions under the Medicare Part B CLFS.
We are or have recently been engaged in patent infringement lawsuits and other intellectual property disputes against various competitors in each of the industries in which we operate, some of which are infringement claims against us and some of which are claims we have asserted against third parties, as discussed in “Note 8—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements.
We are or have recently been engaged in patent infringement lawsuits and other intellectual property disputes against various competitors in each of the industries in which we operate, some of which are infringement claims against us and some of which are claims we have asserted against third parties, as discussed in “Note 10—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements.
As part of its PMA review process, the FDA will typically inspect the manufacturer's facilities for compliance with QSR requirements, which impose extensive testing, control, documentation, and other quality assurance procedures. The PMA review process typically takes one to three years from submission but can take longer. De novo pathway .
As part of its PMA review process, the FDA will typically inspect the manufacturer's facilities for compliance with QMSR requirements, which impose extensive testing, control, documentation, and other quality assurance procedures. The PMA review process typically takes one to three years from submission but can take longer. De novo pathway .
Our ERGs provide a platform of networking, ongoing learning and exchange to support professional development and promote overall workplace culture, engagement and satisfaction, and encompass a variety of focuses such as sustainability; volunteerism; belonging; fostering development and growth of early career professionals; and supporting veterans.
Our ERGs provide a platform of networking, ongoing learning and exchange to support professional development and promote overall workplace culture, engagement and satisfaction, and encompass a variety of focuses such as sustainability; cancer survivorship; volunteerism; belonging; fostering development and growth of early career professionals; and supporting veterans.
Horizon screens for up to 613 inherited conditions across a selection of screening panels, including Cystic Fibrosis, Duchenne Muscular Dystrophy, or DMD, Spinal Muscular Atrophy, Fragile X Syndrome and other conditions, and performs with a 99% detection rate for most conditions.
Horizon screens for up to 835 inherited conditions across a selection of screening panels, including Cystic Fibrosis, Duchenne Muscular Dystrophy, or DMD, Spinal Muscular Atrophy, Fragile X Syndrome and other conditions, and performs with a 99% detection rate for most conditions.
A violation of Section 102.001 or 102.006 is punishable by civil penalties (up to $10,000 per violation). The Texas Medicaid anti-kickback laws, 1 TAC 371.1669, cross-references 24 Table of Contents the Texas Patient Solicitation Act and include other prohibited self-referrals that are grounds for enforcement and sanctions.
A violation of Section 102.001 or 102.006 is punishable by civil penalties (up to $10,000 per violation). The Texas Medicaid anti-kickback laws, 1 TAC 371.1669, cross-references the Texas Patient Solicitation Act and include other prohibited self-referrals that are grounds for enforcement and sanctions.
Renasight is our kidney gene panel test to determine if there may be a genetic cause for an individual’s CKD, or increased hereditary risk for kidney disease due to family history. The test uses a blood or saliva sample to test over 380 genes associated with CKD, ranging from common inherited kidney disorders to more rare conditions.
Renasight is our kidney gene panel test to determine if there may be a genetic cause for an individual’s CKD, or increased hereditary risk for kidney disease due to family history. The test uses a blood or saliva sample to test 397 genes associated with CKD, ranging from common inherited kidney disorders to more rare conditions.
All testing personnel must maintain a California state license or be supervised by licensed personnel, and our laboratory director must maintain an additional license issued by the California Department of Public Health, or CDPH. Clinical laboratories are subject to both routine and complaint-initiated on-site inspections by the state.
All testing personnel must maintain a California state license or be supervised by licensed personnel, and our laboratory director must maintain an additional license issued by the California Department of Public Health, or CDPH. ​ 21 Table of Contents Clinical laboratories are subject to both routine and complaint-initiated on-site inspections by the state.
Through this model, we have been able to expand access to our molecular and bioinformatics capabilities worldwide, enabling laboratories, under a license from us, to run the molecular workflows themselves and then access our computation-intensive bioinformatics algorithms through Constellation, which runs in the cloud, to analyze the results.
Through this model, we have been able to expand access to our molecular and bioinformatics capabilities worldwide, enabling laboratories in the United States and internationally, under a license from us, to run the molecular workflows themselves and then access our computation-intensive bioinformatics algorithms through Constellation, which runs in the cloud, to analyze the results.
An RUO product promoted for diagnostic use may be viewed by the FDA as 18 Table of Contents adulterated and misbranded under the FDC Act and the manufacturer of such product could be subject to FDA enforcement activities. Our LDTs use instruments and reagents labeled as RUO. Laboratory-developed tests .
An RUO product promoted for diagnostic use may be viewed by the FDA as adulterated and misbranded under the FDC Act and the manufacturer of such product could be subject to FDA enforcement activities. Our LDTs use instruments and reagents labeled as RUO. Laboratory-developed tests .
PAMA authorizes CMS to impose civil monetary penalties – up to $12,958 per day in 2024 – for each failure to report or each misrepresentation or omission in reporting of required information. CMS has granted Medicare Part B coverage and Advanced Diagnostic Laboratory Test (ADLT) status, which has separate reporting and payment requirements under PAMA, for our Signatera test.
PAMA authorizes CMS to impose civil monetary penalties – up to $13,295 per day in 2024 – for each failure to report or each misrepresentation or omission in reporting of required information. CMS has granted Medicare Part B coverage and Advanced Diagnostic Laboratory Test (ADLT) status, which has separate reporting and payment requirements under PAMA, for our Signatera test.
For example, 26 Table of Contents California has a direct bill rule specific to anatomic pathology services that prohibits any provider from billing for anatomic pathology services if those services were not actually rendered by that person or under his or her direct supervision with some exemptions (CA Business and Professions Code Section 655.7).
For example, California has a direct bill rule specific to anatomic pathology services that prohibits any provider from billing for anatomic pathology services if those services were not actually rendered by that person or under his or her direct supervision with some exemptions (CA Business and Professions Code Section 655.7).
The Special 23 Table of Contents Fraud Alerts set forth a number of practices allegedly engaged in by some clinical laboratories and healthcare providers that raise issues under the federal fraud and abuse laws, including the federal Anti-Kickback Statute.
The Special Fraud Alerts set forth a number of practices allegedly engaged in by some clinical laboratories and healthcare providers that raise issues under the federal fraud and abuse laws, including the federal Anti-Kickback Statute.
Class III devices are generally the highest risk devices and are subject to the highest level of regulatory control to provide reasonable assurance of the device's safety and 17 Table of Contents effectiveness. Class III devices typically require a PMA by the FDA before they are marketed.
Class III devices are generally the highest risk devices and are subject to the highest level of regulatory control to provide reasonable assurance of the device's safety and effectiveness. Class III devices typically require a PMA by the FDA before they are marketed.
Information from the test can lead to earlier detection of cancer, identify cancer risk-reducing strategies, inform surgical and therapeutic decisions following a cancer diagnosis, and provide an opportunity to notify family members who may be at similar risk for hereditary cancer. We sell this test through both our women’s health and oncology commercial channels.
Empower, our hereditary cancer screening test, can lead to earlier detection of cancer, identify cancer risk-reducing strategies, inform surgical and therapeutic decisions following a cancer diagnosis, and provide an opportunity to notify family members who may be at similar risk for hereditary cancer. We sell this test through both our women’s health and oncology commercial channels.
Any revocation of a 20 Table of Contents CLIA certificate or exclusion from participation in Medicare or Medicaid programs may also result in suspension of the California state laboratory license.
Any revocation of a CLIA certificate or exclusion from participation in Medicare or Medicaid programs may also result in suspension of the California state laboratory license.
Organ Health Prospera Our Prospera test is used to assess active rejection in patients who have undergone kidney, heart, or lung transplantation by measuring the fraction and quantity of dd-cfDNA in the recipient’s blood, which can spike relative to background cfDNA when the transplanted organ is injured due to immune rejection.
Organ Health Prospera Our Prospera test is used to assess active rejection in patients who have undergone solid organ transplantation by measuring the fraction and quantity of dd-cfDNA in the recipient’s blood, which can spike relative to background cfDNA when the transplanted organ is injured due to immune rejection.
Signatera has been shown in various clinical studies – including over 100 peer-reviewed publications as of February 1, 2025 – to identify MRD significantly earlier than standard diagnostic tools, and that Signatera test status is a significant indicator of long-term patient outcomes after surgery and treatment, relative to other clinical and pathological factors.
Signatera has been shown in various clinical studies – including over 170 peer-reviewed publications as of December 31, 2025 – to identify MRD significantly earlier than standard diagnostic tools, and that Signatera test status is a significant indicator of long-term patient outcomes after surgery and treatment, relative to other clinical and pathological factors.
A violation of the federal Civil Monetary Penalty statute may result in maximum civil fines – up to $124,732 in 2024 – plus treble damages and exclusion from participation in any federal health care program. Because we operate a laboratory facility located in California and licensed by California’s DHS, California law is applicable to our business arrangements.
A violation of the federal Civil Monetary Penalty statute may result in maximum civil fines – up to $127,973 in 2025 – plus treble damages and exclusion from participation in any federal health care program. Because we operate a laboratory facility located in California and licensed by California’s DHS, California law is applicable to our business arrangements.
Many Class I devices are exempt from FDA premarket review requirements. Class II devices, including some software products to the extent that they qualify as a device, are deemed to be moderate risk, and generally require 510(k) clearance.
Class I devices are deemed to be low risk and are subject to the fewest regulatory controls. Many Class I devices are exempt from FDA premarket review requirements. Class II devices, including some software products to the extent that they qualify as a device, are deemed to be moderate risk, and generally require 510(k) clearance.
For more information on state licensing requirements, see “—California Laboratory Licensing”, “—New York Laboratory Licensing,” and “—Other State Laboratory Licensing Laws.” Our laboratories have each also been accredited by the College of American Pathologists, or CAP, which means that our laboratories have been certified as following CAP standards and guidelines in operating the laboratory facility and in performing tests that ensure the quality of our test results.
For more information on state licensing requirements, see “—California Laboratory Licensing”, “—New York Laboratory Licensing,” and “—Other State Laboratory Licensing Laws.” Our laboratories located in Austin, Texas; San Carlos, California; and Boulder, Colorado have each also been accredited by the College of American Pathologists, or CAP, which means that our laboratories have been certified as following CAP standards and guidelines in operating the laboratory facility and in performing tests that ensure the quality of our test results.
Any person who presents or causes to be presented a claim to the Medicare or Medicaid programs in violation of the Stark Law may be subject to civil monetary penalties – up to $30,868 in 2024 – per claim submission, an assessment of up to three times the amount claimed, and exclusion from participation in any federal health care program.
Any person who presents or causes to be presented a claim to the Medicare or Medicaid programs in violation of the Stark Law may be subject to civil monetary penalties – up to $31,670 in 2025 – per claim submission, an assessment of up to three times the amount claimed, and exclusion from participation in any federal health care program.
The FDA historically has taken the position that it has the authority to regulate such tests as medical devices under the FDC Act but had historically exercised enforcement discretion and did not require clearance, de novo classification, or approval of most LDTs prior to marketing.
The FDA historically took the position that it had the authority to regulate such tests as medical devices under the FDC Act but generally exercised enforcement discretion with respect to most LDTs and did not require clearance, de novo classification, or approval of most LDTs prior to marketing.
Under the final rule, all LDTs, unless subject to a specific exemption, will be subject to premarket authorization requirements (510(k), de novo classification, or PMA), and laboratories performing LDTs will need to comply with postmarket registration and listing, medical device reporting, correction, removal and recall, complaint handling, labeling, investigational device, and quality system requirements.
Under the final rule, all LDTs, unless subject to a specific exemption, would have been subject to premarket authorization requirements (510(k), de novo classification, or PMA), and laboratories performing LDTs would have needed to comply with postmarket registration and listing, medical device reporting, correction, removal and recall, complaint handling, labeling, investigational device, and quality system requirements.
Panorama screens for common genetic conditions that affect both high-risk pregnancies, where maternal age is 35 years or older and which we estimate represent approximately 800,000 of the approximately 4.3 million pregnancies in the United States, and average-risk pregnancies, which we estimate represent approximately 3.5 million pregnancies in the United States.
Panorama screens for common genetic conditions that affect both high-risk pregnancies, where maternal age is 35 years or older, which we estimate represent approximately 1.0 million of the approximately 5.36 million pregnancies in the United States, and average-risk pregnancies, which we estimate represent approximately 4.36 million pregnancies in the United States.
A violation of the federal Anti-Kickback Statute may result in imprisonment for up to ten years and/or criminal or civil fines – up to $104,330 (or $27,894 for each wrongful act) in 2024 – and exclusion from participation in federal health care programs.
A violation of the federal Anti-Kickback Statute may result in imprisonment for up to ten years and/or criminal or civil fines – up to $104,330 (or $28,619 for each wrongful act) in 2025 – and exclusion from participation in federal health care programs.
We are committed to generating peer-reviewed clinical evidence for our tests, with over 250 peer-reviewed publications as of December 31, 2024, and to maintaining a strong intellectual property portfolio, with over 500 issued or pending patents as of December 31, 2024. ​ Our revenues were $1,696.9 million in 2024 compared to $1,082.6 million in 2023 and $820.2 million in 2022.
We are committed to generating peer-reviewed clinical evidence for our tests, with over 350 peer-reviewed publications as of December 31, 2025, and to maintaining a strong intellectual property portfolio, with over 650 issued or pending patents as of December 31, 2025. ​ Our revenues were $2,306.1 million in 2025 compared to $1,696.9 million in 2024 and $1,082.6 million in 2023.
In 2024, more than 92% of employees participated in our employee engagement survey, the results of which indicated an overall 84% engagement score, and that 91% of employees are proud to work at Natera (a 7% increase from 2023), and 80% would recommend Natera as a great place to work.
More than 92% of employees participated in our most recent employee engagement survey, conducted in 2024, the results of which indicated an overall 84% engagement score, and that 91% of employees are proud to work at Natera, and 80% would recommend Natera as a great place to work.
Fetal aneuploidy – an inherited genetic condition in which a fetus has a different number of chromosomes than are typical. IVD – in vitro diagnostic; tests that can be used in any laboratory that has the appropriate qualifications and authorizations. IVF – in vitro fertilization.
FDA – Food and Drug Administration. 30 Table of Contents Fetal aneuploidy – an inherited genetic condition in which a fetus has a different number of chromosomes than are typical. IVD – in vitro diagnostic; tests that can be used in any laboratory that has the appropriate qualifications and authorizations. IVF – in vitro fertilization.
In oncology, with our Signatera circulating tumor DNA, or ctDNA, test that is custom designed for, informed by and specific to, the tumor DNA for each patient, we have demonstrated the ability to detect ctDNA with a high degree of sensitivity and specificity.
We believe our approach represents a fundamental advance in molecular biology. For example, in oncology, with our Signatera circulating tumor DNA, or ctDNA, test that is custom designed for, informed by and specific to the tumor DNA for each patient, we have demonstrated the ability to detect ctDNA with a high degree of sensitivity and specificity.
We believe our approach represents a fundamental advance in molecular biology. In women’s health, this approach is distinct from the approach employed with other commercially available NIPTs, which use first-generation “quantitative”, or counting, methods to compare the relative number of sequence reads from a chromosome of interest to a reference chromosome.
In women’s health, our approach is distinct from the approach employed with other commercially available NIPTs, which use first-generation “quantitative”, or counting, methods to compare the relative number of sequence reads from a chromosome of interest to a reference chromosome.
Our clinical validation study for Prospera Kidney, conducted in collaboration with the University of California, San Francisco, a recognized leader in transplantation care, and published in the Journal of Clinical Medicine, demonstrated 89% sensitivity in detecting active rejection, with specificity of 73%, based on a cutoff of 1% dd-cfDNA.
Our original clinical validation study for Prospera Kidney, conducted in collaboration with the University of California, San Francisco, a recognized leader in transplantation care, and published in the Journal of Clinical Medicine, demonstrated 89% sensitivity in detecting active rejection, with an AUC of 0.87 and NPV of 95%, based on a cutoff of 1% dd-cfDNA.
We processed approximately 3.1 million tests in 2024, compared to approximately 2.5 million tests in 2023 and 2.1 million tests in 2022. We are headquartered in Austin, Texas, and our laboratory facilities are located in Austin, Texas and San Carlos, California.
We processed approximately 3.5 million tests in 2025, compared to approximately 3.1 million tests in 2024 and 2.5 million tests in 2023. We are headquartered in Austin, Texas, with laboratory facilities located in Austin, Texas, San Carlos, California and Boulder, Colorado.
Progress on the 2025 ESG goals are presented to the board twice annually, in addition to updates regarding climate impacts and broader ESG strategy discussions. Additional information can be found in our annual ESG Report located on our website at www.natera.com/esg.
Progress on all sustainability goals are presented to the board at least annually, in addition to updates regarding climate impacts and broader strategy discussions. Additional information, including goal progress, can be found in our annual Sustainability Report located on our website at www.natera.com/sustainability.
The Anora test is helpful to obstetricians, gynecologists and IVF physicians in supporting their patients’ reproductive goals. Anora can help couples understand the likelihood of another miscarriage, their future reproductive options, and whether there are any steps that could help them avoid a miscarriage in future pregnancies.
Anora can detect trisomy, triploidy, extra or missing chromosome pieces, and uniparental disomy. The Anora test is helpful to obstetricians, gynecologists and IVF physicians in supporting their patients’ reproductive goals. Anora can help couples understand the likelihood of another miscarriage, their future reproductive options, and whether there are any steps that could help them avoid a miscarriage in future pregnancies.
In organ health, our primary competitor is CareDx, Inc. We expect additional competition as other established and emerging companies enter these markets, including through business combinations, and as new tests and technologies are introduced. These competitors could have greater technological, financial, reputational and market access resources than us.
We expect additional competition as other established and emerging companies enter these markets, including through business combinations, and as new tests and technologies are introduced. These competitors could have greater technological, financial, reputational and market access resources than us.
A significant number of heart transplant patients experience acute rejection in their first year – over 31% of recipients aged 18 to 34, and over 18% of recipients aged 65 or older, who received a transplant in 2020 experienced acute rejection in their first year.
A significant number of heart transplant patients experience acute rejection in their first year – approximately 25% of recipients aged 18 to 34, and approximately 15% of recipients aged 65 or older, who received a transplant in 2022 experienced acute rejection in their first year.
CS test – carrier screening test. 28 Table of Contents dd-cfDNA – donor-derived cell-free DNA; DNA that is shed into the blood of a transplant recipient from a transplanted organ undergoing rejection. DNA – deoxyribonucleic acid. FDA – Food and Drug Administration.
CS test – carrier screening test. dd-cfDNA – donor-derived cell-free DNA; DNA that is shed into the blood of a transplant recipient from a transplanted organ undergoing rejection. DNA – deoxyribonucleic acid.
Lung transplantation has a five-year survival rate of approximately 60%, and chronic lung allograft dysfunction, or CLAD, is a leading cause of death beyond the first year, affecting close to 50% of recipients by five years post-transplant.
The Prospera Heart test is covered by Medicare for heart transplant patients. 12 Table of Contents Lung transplantation has a five-year survival rate of approximately 60%, and chronic lung allograft dysfunction, or CLAD, is a leading cause of death beyond the first year, affecting close to 50% of recipients by five years post-transplant.
Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, may be obtained free of charge at the Investor Relations section of our website, http://investor.natera.com, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission, or SEC.
We do not incorporate the information on, or accessible through, our website into this Annual Report on Form 10-K or any other report we file with or furnish to the SEC, and you should not consider any information on, or accessible through, our website as part of this Annual Report on Form 10-K or any other report we file with or furnish to the SEC. ​ 31 Table of Contents Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, may be obtained free of charge at the Investor Relations section of our website, http://investor.natera.com, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission, or SEC.
Our product revenues were $1,685.1 million, $1,068.5 million, and $797.3 million for the years ended December 31, 2024, 2023, and 2022, respectively. Our net losses decreased to $190.4 million in 2024, from $434.8 million in 2023 and $547.8 million in 2022.
Our product revenues were $2,295.8 million, $1,685.1 million, and $1,068.5 million for the years ended December 31, 2025, 2024, and 2023, respectively. Our net losses increased to $208.2 million in 2025, from $190.4 million in 2024 and decreased from $434.8 million in 2023.
A clinical trial is almost always required to support a PMA application and is sometimes required for 510(k) clearance. All clinical studies of investigational devices must be conducted in compliance with any applicable FDA and Institutional Review Board requirements.
A clinical trial is almost always required to support a PMA application and is sometimes required for 510(k) clearance. All clinical studies of investigational devices must be conducted in compliance with any applicable FDA requirements, including in some cases approval of an investigational device exemption, or IDE, application, as well as with Institutional Review Board requirements.
Entities found in violation may be liable for civil monetary penalties – up to $100,000 (or $24,947 for each wrongful act) in 2024.
Entities found in violation may be liable for civil monetary penalties – up to $100,000 (or $25,595 for each wrongful act) in 2025.
For example, when learning prior to birth that a newborn has 22q11.2 deletion syndrome, doctors will know to monitor the infant and administer calcium if needed to avoid seizures and permanent cognitive impairment, and will know to avoid administering routine vaccinations due to the immunodeficiency frequently 7 Table of Contents associated with this condition.
For example, when learning prior to birth that a newborn has 22q11.2 deletion syndrome, doctors will know to monitor the infant and administer calcium if needed to avoid seizures and permanent cognitive impairment, and may decide to delay live vaccine administration due to the immunodeficiency frequently associated with this condition.
In particular, the EU’s General Data Protection Regulation, or GDPR, became effective in 2018. The GDPR applies not only to organizations within the EU, but also applies to organizations outside of the EU, such as Natera, that offer goods or services to EU data subjects or that process personal data of EU data subjects.
The GDPR applies not only to organizations within the EU, but also applies to organizations outside of the EU, such as Natera, that offer goods or services to EU data subjects or that process personal data of EU data subjects.
Finally, federal law prohibits any entity from offering or transferring to a Medicare or Medicaid beneficiary any remuneration that the entity knows or should know is likely to influence the beneficiary’s selection of a particular provider, practitioner or supplier of Medicare or Medicaid payable items or services, including waivers of copayments and deductible amounts (or any part thereof), if any apply, and transfers of items or services for free or for other than fair market value.
A violation of either statute is a felony and may result in fines or imprisonment or, in the case of the healthcare fraud statute, exclusion from government sponsored programs. 27 Table of Contents Finally, federal law prohibits any entity from offering or transferring to a Medicare or Medicaid beneficiary any remuneration that the entity knows or should know is likely to influence the beneficiary’s selection of a particular provider, practitioner or supplier of Medicare or Medicaid payable items or services, including waivers of copayments and deductible amounts (or any part thereof), if any apply, and transfers of items or services for free or for other than fair market value.
While we have attempted to comply with the federal, Texas, California and New York fraud and abuse laws and similar laws of other states and non-U.S. jurisdictions that are applicable to our business, it is possible that some of our arrangements could be subject to regulatory scrutiny at some point in the future, and we cannot provide assurance that we will be found to be in compliance with these laws following any such regulatory review.
While we have attempted to comply with the federal, Texas, California and New York fraud and abuse laws and similar laws of other states and non-U.S. jurisdictions that are applicable to our business, it is possible that some of our arrangements could be subject to regulatory scrutiny at some point in the future, and we cannot provide assurance that we will be found to be in compliance with these laws following any such regulatory review. 28 Table of Contents Human Capital Management As of December 31, 2025, our global workforce comprised 6,140 employees, of whom 6,135 were full time employees.
The FDA considers LDTs to be tests that are designed, developed, validated and used within a single laboratory.
The FDA considers LDTs to be tests that are designed, developed, validated and used within a single laboratory certified under the Clinical Laboratory Improvement Amendments, or CLIA.
The Prospera Heart test has also demonstrated strong performance in detecting rejection in pediatric heart transplant recipients, with an AUC of 0.83 in pediatric patients, comparable to an AUC of 0.82 in adult patients in the study, published in Pediatric Transplantation . The Prospera Heart test is covered by Medicare for heart transplant patients.
The Prospera Heart test has also demonstrated strong performance in detecting rejection in pediatric heart transplant recipients, with an AUC of 0.83 in pediatric patients in a study published in Pediatric Transplantation .
We believe that our engagement survey results reflect our commitment to fostering a thriving workplace culture, even amidst significant organizational growth. We have a growing number of employee resource groups, or ERGs, which offer opportunities for our employees to build connection and create a supportive and inclusive culture of belonging and awareness, which we believe positively impacts our workplace.
We have a growing number of employee resource groups, or ERGs, which offer opportunities for our employees to build connection and create a supportive and inclusive culture of belonging and awareness, which we believe positively impacts our workplace.
Differences in the specific sequence and structure of the chemical building blocks, or bases, that make up DNA drive biological diversity, including genetic mutations; certain variations can cause disease.
Differences in the specific sequence and structure of the chemical building blocks, or bases, that make up DNA drive biological diversity, including genetic mutations; with certain variations causing disease. An example of genetic diversity is a change in a single chemical base.
We are committed to attracting, retaining, developing, and nurturing a diverse workforce, which we believe is necessary in order to deliver upon our mission of changing the management of disease worldwide.
Also based on self-identification data, minorities comprised approximately 39% of our U.S. workforce . We are committed to attracting, retaining, developing, and nurturing a diverse workforce, which we believe is necessary in order to deliver upon our mission of changing the management of disease worldwide.
Sustainability We recognize that in our work to improve the state of disease globally, it is important to develop and maintain a strong ethos of sustainability, responsibility, and stewardship with respect to environmental matters.
Sustainability We recognize that in our work to improve the state of disease globally, it is important to develop and maintain a strong ethos of sustainability, responsibility, and stewardship with respect to environmental matters. We have policies and programs in place to comply with the requirements set forth in applicable local, state, and federal environmental policies, laws and regulations.
A person who engages in a scheme to circumvent the 25 Table of Contents Stark Law’s referral prohibition may be fined – up to $205,799 in 2024 – for each such arrangement or scheme.
A person who engages in a scheme to circumvent the Stark Law’s referral prohibition may be fined – up to $211,146 in 2025 – for each such arrangement or scheme.
Potential sanctions for violation of state statutes and regulations can include significant monetary fines, the rejection of license applications, the suspension or loss of various licenses, certificates and authorizations, and in some cases criminal penalties, which could harm our business. CLIA does not preempt state laws that have established laboratory quality standards that are more stringent than federal law.
Potential sanctions for violation of state statutes and regulations can include significant monetary fines, the rejection of license applications, the suspension or loss of various licenses, certificates and authorizations, and in some cases criminal penalties, which could harm our business.
Based on our internal estimates, we believe that the total addressable market in the United States for recurrence and treatment monitoring for solid tumor cancers is over $15 billion. We are also leveraging our experience in MRD assay development to research, develop and clinically validate an early cancer detection test, with an initial focus on colorectal cancer.
The total addressable market in the United States for recurrence monitoring for solid tumor cancers, including immunotherapy treatment response monitoring, is estimated to be approximately $21 billion, and for blood cancers is estimated to be approximately $3 billion. 7 Table of Contents We are also leveraging our experience in MRD assay development to research, develop and clinically validate an early cancer detection test, with an initial focus on colorectal cancer.
In addition to our direct sales force in the United States, we have a global network of over 100 laboratory and distribution partners, including many of the largest international laboratories.
We intend to continue to enhance our existing products, expand our product portfolio, and launch new products in the future. In addition to our direct sales force in the United States, we have a global network of over 100 laboratory and distribution partners, including several of the largest international laboratories.
State Genetic Testing and Privacy Laws Many states have implemented genetic testing and privacy laws imposing specific patient consent requirements and protecting test results. Under some state laws, we are prohibited from conducting genetic tests without appropriate documentation of patient (or parental/guardian) consent from the physician ordering the test.
Under some state laws, we are prohibited from conducting genetic tests without appropriate documentation of patient (or parental/guardian) consent from the physician ordering the test.
Our molecular biology techniques are based on measuring thousands of SNPs simultaneously using massively multiplexed polymerase chain reaction, or mmPCR, to multiplex, or target, many thousands of regions of the genome simultaneously in a single test reaction.
When single base changes are common in the population, that position on the chromosome is called a single nucleotide polymorphism, or SNP. 6 Table of Contents Our molecular biology techniques are based on measuring thousands of SNPs simultaneously, using massively multiplexed polymerase chain reaction, or mmPCR, to multiplex, or target, many thousands of regions of the genome simultaneously in a single test reaction.
Based on our internal estimates, we believe the total addressable market in the United States for tests such as ours that assess kidney, heart and lung transplant rejection is approximately $3.0 billion. Our Prospera Kidney test is designed to give physicians a comprehensive view of a patient’s rejection status.
Based on our internal estimates, we believe the total addressable market in the United States for tests such as ours that assess kidney, heart and lung transplant rejection is over $3.8 billion.
As a health care provider, we are also subject to Section 4004 of the 21 st Century Cures Act, or Cures Act, and regulations promulgated by HHS related to patient access to electronic PHI, or EHI, to promote interoperability and to ensure the access, exchange, or use of EHI.
As a health care provider, we are subject to Section 4004 of the 21 st Century Cures Act, or Cures Act, and regulations promulgated by HHS related to patient access to electronic PHI, or EHI, to promote interoperability and to ensure the access, exchange, or use of EHI. 23 Table of Contents Various U.S. states have implemented personal privacy laws that regulate different information than HIPAA.
Reimbursement by third-party payers may depend on a number of factors, including the payer’s determination that tests using our technologies are: not experimental or investigational; medically necessary; demonstrated to lead to 16 Table of Contents improved patient outcomes; appropriate for the specific patient; cost-saving or cost-effective; supported by peer-reviewed medical journals; and included in clinical guidelines.
We continue to believe that growing recognition from professional societies of the importance of microdeletions testing, combined with the performance of our microdeletions test and additional validation data from our SMART study on the sensitivity and specificity of our tests, will help drive broader reimbursement in the future. ​ 17 Table of Contents Reimbursement by third-party payers may depend on a number of factors, including the payer’s determination that tests using our technologies are: not experimental or investigational; medically necessary; demonstrated to lead to improved patient outcomes; appropriate for the specific patient; cost-saving or cost-effective; supported by peer-reviewed medical journals; and included in clinical guidelines.
In June 2021, Congress introduced the Verifying Accurate, Leading-edge IVCT Development Act, or VALID Act, which would have established a new risk-based regulatory framework for in vitro clinical tests (“IVCTs”), a category which would have included IVDs, LDTs, collection devices and instruments used with such tests.
In June 2021, Congress introduced the Verifying Accurate, Leading-edge IVCT Development Act, or VALID Act, to establish a new risk-based regulatory framework for in vitro clinical tests, or IVCTs, including IVDs, LDTs, collection devices and instruments used with such tests. This legislation was re-introduced in 2023 but was not enacted.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAccordingly, the market price of our common stock is likely to be subject to wide fluctuations in response to numerous factors, many of which are beyond our control, such as those in this “Risk Factors” section and others including: • actual or anticipated variations in our and our competitors’ results of operations, as well as how those results compare to analyst and investor expectations; • announcements by us or our competitors of new products, significant acquisitions, other strategic transactions, including strategic and commercial partnerships and relationships, joint ventures, divestitures, collaborations or capital commitments; • changes in reimbursement practices by current or potential payers; • failure of analysts to initiate or maintain coverage of our company, issuance of new securities analysts’ reports or changed recommendations for our stock; • negative publicity, including misinformation, about our company, our tests, or the commercial markets in which we operate; • forward-looking statements related to our financial guidance or projections, our failure to meet or exceed our financial guidance or projections or changes in our financial guidance or projections; • actual or anticipated changes in regulatory oversight of our products; • development of disputes concerning our intellectual property or other proprietary rights; • commencement of, or our involvement in, litigation and the outcomes of our litigation matters; • announcement or expectation of additional debt or equity financing efforts; • any major change in our management; • general economic conditions and slow or negative growth of our markets, including as a result of changes in the rate of inflation (including the cost of raw materials, commodities, and supplies) and interest rates; and 60 Table of Contents • changes in business, economic, and political conditions, including war, political instability and related military action.
Biggest changeAccordingly, the market price of our common stock is likely to be subject to wide fluctuations in response to numerous factors, many of which are beyond our control, such as those in this “Risk Factors” section and others including: • actual or anticipated variations in our and our competitors’ results of operations, as well as how those results compare to analyst and investor expectations; • announcements by us or our competitors of new products, significant acquisitions, other strategic transactions, including strategic and commercial partnerships and relationships, joint ventures, divestitures, collaborations or capital commitments; • changes in reimbursement practices by current or potential payers; • failure of analysts to initiate or maintain coverage of our company, issuance of new securities analysts’ reports or changed recommendations for our stock; • negative publicity, including misinformation, about our company, our tests, or the commercial markets in which we operate; • forward-looking statements related to our financial guidance or projections, our failure to meet or exceed our financial guidance or projections or changes in our financial guidance or projections; • actual or anticipated changes in regulatory oversight of our products; • development of disputes concerning our intellectual property or other proprietary rights; • commencement of, or our involvement in, litigation and the outcomes of our litigation matters; • announcement or expectation of additional debt or equity financing efforts; • any major change in our management; • general economic conditions and slow or negative growth of our markets, including as a result of changes in the rate of inflation (including the cost of raw materials, commodities, and supplies) and interest rates; and • changes in business, economic, and political conditions, including war, political instability and related military action. 65 Table of Contents In addition, if the market for life sciences stocks or the stock market in general experiences uneven investor confidence, as has been the case in the past, the market price of our common stock could decline for reasons unrelated to our business, operating results or financial condition.
Moreover, if FDA premarket clearance, approval or de novo classification is required, our cash flows may be adversely affected until we obtain such clearance, approval or de novo classification, as most third-party payers, including Medicaid, will not reimburse for use of medical devices which are required to, but which do not, have marketing authorization.
Moreover, if FDA premarket authorization is required, our cash flows may be adversely affected until we obtain such clearance, approval or de novo classification, as most third-party payers, including Medicaid, will not reimburse for use of medical devices which are required to, but which do not, have marketing authorization.
Our ability to increase sales and establish significant levels of adoption and reimbursement for our tests is uncertain, and it may be challenging for us to achieve profitability for many reasons, including, among others: • the market for our tests may not grow as we expect; in particular, NIPTs may not gain acceptance for use as a screen for microdeletions, which would limit the market for Panorama, and we may fail to compete successfully in this market, whatever its size; • if we are unable to demonstrate that our tests are superior to competing tests, laboratories, clinics, clinicians, physicians, payers and patients may not adopt the use of our tests on a broad basis, and may not be willing to pay the price premium over competing tests that we have, to date, been able to achieve; 30 Table of Contents • third-party payers, such as commercial insurance companies and government insurance programs, may decide not to reimburse for our tests, such as for the screening of microdeletions, may set the amounts of any reimbursements at prices that do not allow us to cover our expenses, or may otherwise adopt regulations, programs, policies or procedures that restrict or harm our business; for example, with respect to Panorama, many third-party payers currently have negative coverage determinations or otherwise do not reimburse for microdeletions screening and we expect low reimbursement rates for microdeletions screening to continue, at least in the near term; also, most state Medicaid programs currently either reimburse at low rates or do not reimburse for our tests; • billing operations, including managing various requirements by third-party payers to obtain reimbursement for our tests, are complex and time-consuming, and if we are unable to successfully manage such requirements, we may experience reduced and/or delayed reimbursement for our tests, which may impact our results of operations, as has happened in the past with respect to evolving prior authorization requirements; • the results of our SMART Study evaluating the performance of Panorama may fail to convince laboratories, clinics, clinicians, physicians or patients of the benefits of utilizing Panorama for microdeletions and may not increase reimbursement for Panorama; • the results of our clinical trials and any additional clinical and economic utility data that we may develop, present and publish in the future, or that comes from the commercial use of our tests, may be inconsistent with our existing data and may raise questions about the performance of our tests, or may fail to convince laboratories, clinics, clinicians, physicians, payers or patients of the value of our tests; • we may experience supply constraints, including those due to the failure of our key suppliers to provide required sequencers and reagents in sufficient amounts or of adequate quality or disputes with our key suppliers, including those with respect to the required sequencers and reagents from our supplier, Illumina, Inc., or Illumina, who is also one of our main NIPT competitors through its subsidiary, Verinata Health Inc., or Verinata, and with whom we have historically been involved in patent proceedings; • we may experience increased cost of product revenues, and cost of licensing and other revenues, as a percentage of total revenues, as has been the case in previous fiscal periods; • the U.S.
Our ability to increase sales and establish significant levels of adoption and reimbursement for our tests is uncertain, and it may be challenging for us to achieve profitability for many reasons, including, among others: • the market for our tests may not grow as we expect; in particular, NIPTs may not gain acceptance for use as a screen for microdeletions, which would limit the market for Panorama, and we may fail to compete successfully in this market, whatever its size; • if we are unable to demonstrate that our tests are superior to competing tests, laboratories, clinics, clinicians, physicians, payers and patients may not adopt the use of our tests on a broad basis, and may not be willing to pay the price premium over competing tests that we have, to date, been able to achieve; • third-party payers, such as commercial insurance companies and government insurance programs, may decide not to reimburse for our tests, such as for the screening of microdeletions, may set the amounts of any reimbursements at prices that do not allow us to cover our expenses, or may otherwise adopt regulations, programs, policies or procedures that restrict or harm our business; for example, with respect to Panorama, many third-party payers currently have negative coverage determinations or otherwise do not reimburse for microdeletions screening and we expect low reimbursement rates for microdeletions screening to continue, at least in the near term; also, most state Medicaid programs currently either reimburse at low rates or do not reimburse for our tests; 32 Table of Contents • billing operations, including managing various requirements by third-party payers to obtain reimbursement for our tests, are complex and time-consuming, and if we are unable to successfully manage such requirements, we may experience reduced and/or delayed reimbursement for our tests, which may impact our results of operations, as has happened in the past with respect to evolving prior authorization requirements; • the results of our SMART Study evaluating the performance of Panorama may fail to convince laboratories, clinics, clinicians, physicians or patients of the benefits of utilizing Panorama for microdeletions and may not increase reimbursement for Panorama; • the results of our clinical trials and any additional clinical and economic utility data that we may develop, present and publish in the future, or that comes from the commercial use of our tests, may be inconsistent with our existing data and may raise questions about the performance of our tests, or may fail to convince laboratories, clinics, clinicians, physicians, payers or patients of the value of our tests; • we may experience supply constraints, including those due to the failure of our key suppliers to provide required sequencers and reagents in sufficient amounts or of adequate quality or disputes with our key suppliers, including those with respect to the required sequencers and reagents from our supplier, Illumina, Inc., or Illumina, who is also one of our main NIPT competitors through its subsidiary, Verinata Health Inc., or Verinata, and with whom we have historically been involved in patent proceedings; • we may experience increased cost of product revenues, and cost of licensing and other revenues, as a percentage of total revenues, as has been the case in previous fiscal periods; • the U.S.
We are subject to healthcare fraud and abuse regulation and enforcement by both the U.S. federal government and the states in which we conduct our business, including: • HIPAA, which created federal civil and criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters and also imposes significant obligations with respect to maintenance of the privacy and security, and transmission, of individually identifiable health information; • federal and state laws and regulations governing consumer protections, data privacy, informed consent for genetic testing, and the use of genetic material; • federal and state laws and regulations governing the submission of claims, as well as billing and collection practices, for healthcare services; • the federal Anti-Kickback Statute, which prohibits, among other things, the knowing and willful solicitation, receipt, offer or payment of remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal health care programs, such as Medicare; • the federal False Claims Act which prohibits, among other things, the presentation of false or fraudulent claims for payment from Medicare, Medicaid, or other government-funded third-party payers; • federal laws and regulations governing the Medicare program, providers of services covered by the Medicare program, and the submission of claims to the Medicare program, as well as the manuals and guidance issued by CMS and the local medical policies promulgated by the Medicare Administrative Contractors with respect to the implementation and interpretation of such laws and regulations; 54 Table of Contents • the federal Stark law, also known as the physician self-referral law, which, subject to certain exceptions, prohibits a physician from making a referral for certain designated health services covered by the Medicare program (and according to case law in some jurisdictions, the Medicaid program as well), including laboratory and pathology services, if the physician or an immediate family member has a financial relationship with the entity providing the designated health services; • the federal Civil Monetary Penalties Law, which, subject to certain exceptions, prohibits, among other things, the offer or transfer of remuneration to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner or supplier of services reimbursable by Medicare or a state healthcare program; • EKRA, which applies to items or services reimbursed by any health care benefits program, including commercial insurers, that, among other things, prohibits the knowing or willful payment or offer, or the solicitation or receipt, of any remuneration, whether directly or indirectly, overtly or covertly, in cash or in kind, in exchange for the referral or inducement of laboratory testing; • the prohibition on reassignment by the Medicare or Medicaid program beneficiary of claims to any party; and • state law equivalents to the above laws, which may apply to items or services reimbursed by any third-party payer, including commercial insurers, and state data privacy and security laws which may be more stringent than HIPAA.
We are subject to healthcare fraud and abuse regulation and enforcement by both the U.S. federal government and the states in which we conduct our business, including: • HIPAA, which created federal civil and criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters and also imposes significant obligations with respect to maintenance of the privacy and security, and transmission, of individually identifiable health information; • federal and state laws and regulations governing consumer protections, data privacy, informed consent for genetic testing, and the use of genetic material; • federal and state laws and regulations governing the submission of claims, as well as billing and collection practices, for healthcare services; • the federal Anti-Kickback Statute, which prohibits, among other things, the knowing and willful solicitation, receipt, offer or payment of remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal health care programs, such as Medicare; • the federal False Claims Act which prohibits, among other things, the presentation of false or fraudulent claims for payment from Medicare, Medicaid, or other government-funded third-party payers; 58 Table of Contents • federal laws and regulations governing the Medicare program, providers of services covered by the Medicare program, and the submission of claims to the Medicare program, as well as the manuals and guidance issued by CMS and the local medical policies promulgated by the Medicare Administrative Contractors with respect to the implementation and interpretation of such laws and regulations; • the federal Stark law, also known as the physician self-referral law, which, subject to certain exceptions, prohibits a physician from making a referral for certain designated health services covered by the Medicare program (and according to case law in some jurisdictions, the Medicaid program as well), including laboratory and pathology services, if the physician or an immediate family member has a financial relationship with the entity providing the designated health services; • the federal Civil Monetary Penalties Law, which, subject to certain exceptions, prohibits, among other things, the offer or transfer of remuneration to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner or supplier of services reimbursable by Medicare or a state healthcare program; • EKRA, which applies to items or services reimbursed by any health care benefits program, including commercial insurers, that, among other things, prohibits the knowing or willful payment or offer, or the solicitation or receipt, of any remuneration, whether directly or indirectly, overtly or covertly, in cash or in kind, in exchange for the referral or inducement of laboratory testing; • the prohibition on reassignment by the Medicare or Medicaid program beneficiary of claims to any party; and • state law equivalents to the above laws, which may apply to items or services reimbursed by any third-party payer, including commercial insurers, and state data privacy and security laws which may be more stringent than HIPAA.
These provisions, among other things: • authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; • eliminate the ability of our stockholders to call special meetings of stockholders; • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings; • establish a classified board of directors so that not all members of our board are elected at one time; • permit the board of directors to establish the number of directors; • provide that directors may only be removed “for cause” and only with the approval of 75% of our stockholders; 62 Table of Contents • require super-majority voting to amend some provisions in our amended and restated certificate of incorporation and amended and restated bylaws; and • provide that the board of directors is expressly authorized to make, alter or repeal our amended and restated bylaws.
These provisions, among other things: • authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; • eliminate the ability of our stockholders to call special meetings of stockholders; • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings; 67 Table of Contents • establish a classified board of directors so that not all members of our board are elected at one time; • permit the board of directors to establish the number of directors; • provide that directors may only be removed “for cause” and only with the approval of 75% of our stockholders; • require super-majority voting to amend some provisions in our amended and restated certificate of incorporation and amended and restated bylaws; and • provide that the board of directors is expressly authorized to make, alter or repeal our amended and restated bylaws.
Furthermore, the FDA or the Federal Trade Commission, or FTC, as well as state consumer protection agencies, may object to the materials and methods we use to promote the use of our current tests or other LDTs we may develop in the future, including with respect to the product claims in our promotional materials, and may initiate enforcement actions against us.
Furthermore, the FDA or the Federal Trade Commission, or FTC, as well as state consumer protection agencies, may object to the materials and methods we use to promote the use of our current tests or other tests we may develop in the future, including with respect to the product claims in our promotional materials, and may initiate enforcement actions against us.
We do not have any backup platform, server or other means to host our algorithms, and may be unable to find and implement an alternative platform that is satisfactory for our needs on commercially reasonable terms, in a timely manner, or at all.
We do not have any backup cloud platform, server or other means to host our algorithms, and may be unable to find and implement an alternative platform that is satisfactory for our needs on commercially reasonable terms, in a timely manner, or at all.
Our actual liquidity and capital funding requirements will depend on numerous factors, including: • our ability to achieve broader commercial success with our tests and product offerings; • the costs and success of our research, development, and commercialization efforts for potential new products and additional indications for, and enhancements to, current products; • our ability to obtain more extensive coverage and reimbursement for our tests, including for microdeletions screening in NIPT, as well as in additional indications in women’s health, oncology, and organ health as we continue to invest in expanding our offerings in these fields; • our ability to collect on our accounts receivable; • our need to finance capital expenditures and further expand our clinical laboratory operations; • our ability to manage our operating costs; • costs and expenses to protect or enforce our intellectual property rights or to defend against infringement claims brought against us, including any associated litigation settlements or judgments we are required to pay; and • the timing and results of any regulatory authorizations that we are required to obtain for our tests.
Our actual liquidity and capital funding requirements will depend on numerous factors, including: • our ability to achieve broader commercial success with our tests and product offerings; 46 Table of Contents • the costs and success of our research, development, and commercialization efforts for potential new products and additional indications for, and enhancements to, current products; • our ability to obtain more extensive coverage and reimbursement for our tests, including for microdeletions screening in NIPT, as well as in additional indications in women’s health, oncology, and organ health as we continue to invest in expanding our offerings in these fields; • our ability to collect on our accounts receivable; • our need to finance capital expenditures and further expand our clinical laboratory operations; • our ability to manage our operating costs; • costs and expenses to protect or enforce our intellectual property rights or to defend against infringement claims brought against us, including any associated litigation settlements or judgments we are required to pay; and • the timing and results of any regulatory authorizations that we are required to obtain for our tests.
In addition, our proprietary bioinformatics algorithms are a crucial component of our test processing, and combine information derived from our mmPCR assay workflows with publicly available data from the broader scientific community to analyze and return test results.
In addition, our proprietary bioinformatics algorithms are a crucial component of our test processing, and combine information derived from our assay workflows with publicly available data from the broader scientific community to analyze and return test results.
We host the significant majority of these algorithms on a cloud-based software platform pursuant to an agreement with DNAnexus, Inc., or DNAnexus, and both we and our Constellation licensees access our algorithms through the DNAnexus platform.
We host the majority of these algorithms on a cloud‑based software platform pursuant to an agreement with DNAnexus, Inc., or DNAnexus, and both we and our Constellation licensees access our algorithms through the DNAnexus platform.
Furthermore, to the extent that we are unable to retain our employees and they leave our company to join one of our competitors, we cannot assure you that any invention, non-disclosure or non-compete agreements we have in place will provide meaningful protection against a departing employee’s unauthorized 40 Table of Contents use or disclosure of our confidential information, as further discussed in “— Risks Relating to our Intellectual Property—If we are not able to adequately protect our trade secrets and other proprietary information, the value of our technology and products could be significantly diminished .” In addition, our growth may place a significant strain on our operating and financial systems and our management, sales, marketing and administrative resources.
Furthermore, to the extent that we are unable to retain our employees and they leave our company to join one of our competitors, we cannot assure you that any invention, non-disclosure or non-compete agreements we have in place will provide meaningful protection against a departing employee’s unauthorized use or disclosure of our confidential information, as further discussed in “— Risks Relating to our Intellectual Property—If we are not able to adequately protect our trade secrets and other proprietary information, the value of our technology and products could be significantly diminished .” In addition, our growth may place a significant strain on our operating and financial systems and our management, sales, marketing and administrative resources.
Third parties, including our competitors, have asserted and may in the future assert that we are infringing their intellectual property rights; in particular, we are or have recently been engaged in patent infringement lawsuits and other intellectual property disputes against various competitors in each of the industries in which we operate, as described in “Note 8—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements.
Third parties, including our competitors, have asserted and may in the future assert that we are infringing their intellectual property rights; in particular, we are or have recently been engaged in patent infringement lawsuits and other intellectual property disputes against various competitors in each of the industries in which we operate, as described in “Note 10—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements.
Food and Drug Administration, or the FDA, or other U.S. or foreign regulatory or legislative bodies may adopt new regulations or policies, or take other actions that impose significant restrictions on our ability to market and sell our tests, including requiring FDA clearance or approval for the sale of our tests, as further discussed in the risk factor entitled “ Regulatory and Compliance Risks — If the FDA were to begin actively regulating our tests, we could incur substantial costs and delays associated with trying to obtain premarket 510(k) clearance, de novo classification, or premarket approval and incur costs associated with complying with post market controls ”) or of the sequencers, reagents, kits and other consumable products that we purchase from third parties in order to perform our testing; • changes in the funding of the FDA or other government agencies or comparable foreign regulatory authorities could hinder, prevent or delay their regulatory review and approval processes or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely; • our laboratory partners may choose to develop their own tests that are competitive with ours or offer tests provided by our competitors due to pricing or other reasons as has happened in the past, or otherwise fail to effectively market our tests; and competitors may develop and commercialize more effective and/or less expensive tests that deliver comparable results to our tests; • we may fail to adequately protect or enforce our intellectual property relating to our tests, leading to increased competition; or other parties may claim that the practice of our technology by us or our licensees and collaborators infringes such other party’s intellectual property rights, as certain of our competitors have 31 Table of Contents claimed in lawsuits filed against us, as discussed further in “Note 8—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements; if we are required to pay litigation judgments or settlements or pay license fees in order to license third-party intellectual property rights due to actual or alleged infringement based on our running our tests, our results of operations or financial condition could be adversely impacted; • we may be unable to dedicate adequate resources to the maintenance and further technological advancement of our current tests that are necessary for such tests to be competitive in the marketplace because of the demands placed on our research and development and product teams with respect to our continuously expanding portfolio of products and programs, in particular our efforts and focus on developing our oncology and organ health product offerings; • in the event that it is in our commercial or financial interest or we are forced to transition sequencing platforms for Panorama, we may be unable to do so in a commercially sustainable way and that could survive claims of infringement of intellectual property rights of Illumina and other competitors, in a timely manner or at all; and • we may not be successful in commercializing our cloud-based distribution model.
Food and Drug Administration, or the FDA, or other U.S. or foreign regulatory or legislative bodies may adopt new regulations or policies, or take other actions that impose significant restrictions on our ability to market and sell our tests, including requiring FDA clearance or approval for the sale of our tests, as further discussed in the risk factor entitled “ Regulatory and Compliance Risks — If the FDA were to begin actively regulating our tests, we could incur substantial costs and delays associated with trying to obtain premarket 510(k) clearance, de novo classification, or premarket approval and incur costs associated with complying with post market controls ” or of the sequencers, reagents, kits and other consumable products that we purchase from third parties in order to perform our testing; • changes in the funding of the FDA or other government agencies or comparable foreign regulatory authorities could hinder, prevent or delay their regulatory review and approval processes or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely; • our laboratory partners may choose to develop their own tests that are competitive with ours or offer tests provided by our competitors due to pricing or other reasons as has happened in the past, or otherwise fail to effectively market our tests; and competitors may develop and commercialize more effective and/or less expensive tests that deliver comparable results to our tests; • we may fail to adequately protect or enforce our intellectual property relating to our tests, leading to increased competition; or other parties may claim that the practice of our technology by us or our licensees and collaborators infringes such other party’s intellectual property rights, as certain of our competitors have claimed in lawsuits filed against us, as discussed further in “Note 10—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements; if we are required to pay litigation judgments or settlements or pay license fees in order to license third-party intellectual property rights due to actual or alleged infringement based on our running our tests, our results of operations or financial condition could be adversely impacted; • we may be unable to dedicate adequate resources to the maintenance and further technological advancement of our current tests that are necessary for such tests to be competitive in the marketplace because of the demands placed on our research and development and product teams with respect to our continuously expanding portfolio of products and programs, in particular our efforts and focus on developing our oncology and organ health product offerings; and ​ 33 Table of Contents • in the event that it is in our commercial or financial interest or we are forced to transition sequencing platforms for Panorama, we may be unable to do so in a commercially sustainable way and that could survive claims of infringement of intellectual property rights of Illumina and other competitors, in a timely manner or at all.
We are involved in legal matters, including investigations, subpoenas, demands, disputes, litigation, requests for information, and other regulatory or administrative actions or proceedings, including those with respect to intellectual property, testing and test performance, billing, reimbursement, marketing, short seller and media allegations, employment, and other matters. See Note 8— Commitments and Contingencies—Legal Proceedings for a description of our legal matters.
We are involved in legal matters, including investigations, subpoenas, demands, disputes, litigation, requests for information, and other regulatory or administrative actions or proceedings, including those with respect to intellectual property, testing and test performance, billing, reimbursement, marketing, short seller and media allegations, employment, and other matters. See Note 10— Commitments and Contingencies—Legal Proceedings for a description of our legal matters.
The practice guidelines issued by professional societies now generally acknowledge that NIPT is the most sensitive screening option for, and/or are generally supportive of NIPT in, average-risk pregnancies, in addition to high-risk pregnancies. However, while most third-party payers now reimburse for NIPT for average-risk patients, it remains the case that not all third-party payers, particularly state Medicaid payers, do so.
The practice guidelines issued by professional societies now generally acknowledge that NIPT is the most sensitive screening option for, and/or are generally supportive of NIPT in, average-risk pregnancies, in addition to high-risk pregnancies. However, while most third-party payers now reimburse for NIPT for average-risk patients, it remains the case that not all third-party payers, including state Medicaid payers, do so.
Among others, the new regulations introduced risk-based classification for IVDs and require notified body involvement for various classes of devices, including reproductive health tests such as Panorama, which are classified as a Class C product. As such, we are required to submit clinical evidence and post-market performance data to regulators.
Among others, the revised regulations introduced risk-based classification for IVDs and require notified body involvement for various classes of devices, including reproductive health tests such as Panorama, which are classified as a Class C product. As such, we are required to submit clinical evidence and post-market performance data to regulators.
For example, certain of our intellectual property is, or recently has been, the subject of challenges instituted by our competitors, as described in “Note 8—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements. These challenges may impede our ability to protect our proprietary rights from unauthorized use.
For example, certain of our intellectual property is, or recently has been, the subject of challenges instituted by our competitors, as described in “Note 10—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements. These challenges may impede our ability to protect our proprietary rights from unauthorized use.
If we are not able to increase adoption of and grow revenues for our products or services, our business, operating results and financial condition will be harmed. We have incurred net losses since our inception and we anticipate that we will continue to incur losses for the foreseeable future, which could harm our future business prospects.
If we are not able to increase adoption of and grow revenues for our products or services, our business, operating results and financial condition will be harmed. We have incurred net losses since our inception and we anticipate that we will continue to incur losses for the near future, which could harm our future business prospects.
We deal with requests for recoupment from third-party payers from time to time in the ordinary course of our business, and it is likely that we will continue to do so in the future. See “ Note 8—Commitments and Contingencies—Third-Party Payer Reimbursement Audits ” in the Notes to Consolidated Financial Statements.
We deal with requests for recoupment from third-party payers from time to time in the ordinary course of our business, and it is likely that we will continue to do so in the future. See “ Note 10—Commitments and Contingencies—Third-Party Payer Reimbursement Audits ” in the Notes to Consolidated Financial Statements.
Additionally, the adoption of these standards may potentially require enhancements or changes in our systems and will require significant time and cost on behalf of our financial management. A discussion of these standards and other pending changes in GAAP, are further discussed in “Note 2—Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements. ITEM 1B.
Additionally, the adoption of these standards may potentially require enhancements or changes in our systems and will require significant time and cost on behalf of our financial management. A discussion of these standards and other pending changes in GAAP, are further discussed in “Note 2—Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements.
The Sarbanes-Oxley Act also requires that our management report on internal controls over financial reporting be attested to by our independent registered public accounting firm. Although we determined that our internal controls over financial reporting were effective as of December 31, 2024, we must continue to monitor and assess our internal controls over financial reporting.
The Sarbanes-Oxley Act also requires that our management report on internal controls over financial reporting be attested to by our independent registered public accounting firm. Although we determined that our internal controls over financial reporting were effective as of December 31, 2025, we must continue to monitor and assess our internal controls over financial reporting.
To the extent that there is any violation, whether actual, perceived or alleged, of our 49 Table of Contents policies or applicable laws and regulations, we may incur additional training and compliance costs; may, and from time to time do, receive inquiries, such as informal requests for documents, civil investigative demands, and subpoenas, from third-party payers or other third parties, including government entities; or may be held liable or otherwise responsible for such acts of non-compliance.
To the extent that there is any violation, whether actual, perceived or alleged, of our policies or applicable laws and regulations, we may incur additional training and compliance costs; may, and from time to time do, receive inquiries, such as informal requests for documents, civil investigative demands, and subpoenas, from third-party payers or other third parties, including government entities; or may be held liable or otherwise responsible for such acts of non-compliance.
Furthermore, because our licensees under our cloud-based distribution model also exclusively use such sole-sourced components to run the tests they develop based on our technology, and our laboratory distribution partners must use certain of such sole-sourced components in order to 37 Table of Contents utilize our tests, any enforcement action against the supplier by the FDA or any other regulatory authority in the jurisdictions in which our licensees and laboratory distribution partners are located could have an adverse impact on our business.
Furthermore, because our licensees under our cloud-based distribution model also exclusively use such sole-sourced components to run the tests they develop based on our technology, and our laboratory distribution partners must use certain of such sole-sourced components in order to utilize our tests, any enforcement action against the supplier by the FDA or any other regulatory authority in the jurisdictions in which our licensees and laboratory distribution partners are located could have an adverse impact on our business.
The FDA has granted us Breakthrough Device designations for our Signatera test covering its use in various applications.
In addition, The FDA has granted us Breakthrough Device designations for our Signatera test covering its use in various applications.
Illumina has granted us certain rights to Illumina’s intellectual property related to NIPT, including the pooled intellectual property, for running our own tests; however, we do not have an express license to grant rights under the pooled intellectual property to the licensees under our Constellation cloud-based distribution model.
Illumina has granted us certain rights to Illumina’s intellectual property related to NIPT, and to the pooled intellectual property, for running our own tests; however, we do not have an express license to grant rights under the pooled intellectual property to the licensees under our Constellation cloud-based distribution model.
The DNAnexus platform is hosted on third-party data center hosting facilities operated by Amazon Web Services, or AWS, located primarily in the United States and in the European Union. We also host our algorithms on AWS platforms directly.
The DNAnexus platform is hosted on third‑party data center hosting facilities operated by Amazon Web Services, or AWS, located primarily in the United States and in the European Union. We also host our algorithms on AWS platforms directly using AWS HealthOmics.
Government and commercial third-party payers continue to 48 Table of Contents increase their efforts to control the cost, utilization and delivery of healthcare services by demanding price discounts or rebates and limiting coverage of, and amounts they will pay for, molecular diagnostic tests. These measures have resulted in reduced payment rates and decreased utilization in the clinical laboratory industry.
Government and commercial third-party payers continue to increase their efforts to control the cost, utilization and delivery of healthcare services by demanding price discounts or rebates and limiting coverage of, and amounts they will pay for, molecular diagnostic tests. These measures have resulted in reduced payment rates and decreased utilization in the clinical laboratory industry.
Specifically, fee-for-service Medicaid programs generally do not 47 Table of Contents reimburse at rates that exceed Medicare’s fee-for-service rates, and many commercial third-party payers set their payment rates at a percentage of the amounts that Medicare pays for such testing services. Medicare reimbursement rates are typically based on the Clinical Laboratory Fee Schedule, or CLFS, set by CMS.
Specifically, fee-for-service Medicaid programs generally do not reimburse at rates that exceed Medicare’s fee-for-service rates, and many commercial third-party payers set their payment rates at a percentage of the amounts that Medicare pays for such testing services. Medicare reimbursement rates are typically based on the Clinical Laboratory Fee Schedule, or CLFS, set by CMS.
Our San Carlos laboratory is situated near active earthquake fault lines, and both of our laboratories are located in areas that have in recent years experienced, and are likely to experience in the future, severe weather events.
Our San Carlos laboratory is situated near active earthquake fault lines, and our laboratories are located in areas that have in recent years experienced, and are likely to experience in the future, severe weather events.
Either of our laboratories may be harmed or rendered inoperable, or samples could be damaged or destroyed, by natural or manmade disasters, including earthquakes, severe weather, flooding, power outages and contamination, including as a result of a health pandemic, which may render it difficult or impossible for us to perform our tests for some period of time.
Any of these laboratories may be harmed or rendered inoperable, or samples could be damaged or destroyed, by natural or manmade disasters, including earthquakes, severe weather, flooding, power outages and contamination, including as a result of a health pandemic, which may render it difficult or impossible for us to perform our tests for some period of time.
Furthermore, any changes to our testing process may require us to use new or different suppliers or 35 Table of Contents materials with whom or which we are unfamiliar, and which may not perform as we anticipate, and could cause delays, downtime or other operational issues. We rely on third-party laboratories to perform portions of our service offerings.
Furthermore, any changes to our testing process may require us to use new or different suppliers or materials with whom or which we are unfamiliar, and which may not perform as we anticipate, and could cause delays, downtime or other operational issues. We rely on third-party laboratories to perform portions of our service offerings.
In addition, we may have to work with a partner on one or more of our tests or programs, which could lower the economic value of those programs to our company. 44 Table of Contents We have incurred indebtedness that may decrease our business flexibility, access to capital, and/or increase our borrowing costs, which may adversely affect our operations and financial results.
In addition, we may have to work with a partner on one or more of our tests or programs, which could lower the economic value of those programs to our company. We have incurred indebtedness that may decrease our business flexibility, access to capital, and/or increase our borrowing costs, which may adversely affect our operations and financial results.
The loss of our founder and Executive Chairman, our Chief Executive Officer, or one or more other members of our senior management team could have an adverse effect on our business. We may engage in acquisitions, dispositions or other strategic transactions that could disrupt our business, cause dilution to our stockholders or reduce our financial resources.
The loss of our founder and Executive Chairman, our Chief Executive Officer, or one or more other members of our senior management team could have an adverse effect on our business. 45 Table of Contents We may engage in acquisitions, dispositions or other strategic transactions that could disrupt our business, cause dilution to our stockholders or reduce our financial resources.
It is possible that competition in all of the markets in which we operate will continue to increase. Some of our competitors’ products and services are sold at a lower price than ours, which could cause sales of our tests and services to decline or force us to reduce our prices.
It is possible that competition in all of the markets in which we operate will continue to increase. ​ 36 Table of Contents Some of our competitors’ products and services are sold at a lower price than ours, which could cause sales of our tests and services to decline or force us to reduce our prices.
Any of these occurrences could have a material adverse effect on our business, financial condition and results of operations. We rely on commercial courier delivery services to transport samples to our facilities in a timely and cost-efficient manner and if these delivery services are disrupted, our business may be harmed.
Any of these occurrences could have a material adverse effect on our business, financial condition and results of operations. 40 Table of Contents We rely on commercial courier delivery services to transport samples to our facilities in a timely and cost-efficient manner and if these delivery services are disrupted, our business may be harmed.
Any of these factors could adversely affect our ability to obtain commercially relevant or competitively advantageous patent protection for our products. If we are not able to adequately protect our trade secrets and other proprietary information, the value of our technology and products could be significantly diminished.
Any of these factors could adversely affect our ability to obtain commercially relevant or competitively advantageous patent protection for our products. 63 Table of Contents If we are not able to adequately protect our trade secrets and other proprietary information, the value of our technology and products could be significantly diminished.
Additionally, any product liability or professional liability lawsuit could harm our reputation, result in a cessation of our services, or cause our partners to terminate our agreements with them, any of which could adversely impact our results of operations. If we are unable to successfully scale our operations, our business could suffer.
Additionally, any product liability or professional liability lawsuit could harm our reputation, result in a cessation of our services, or cause our partners to terminate our agreements with them, any of which could adversely impact our results of operations. 42 Table of Contents If we are unable to successfully scale our operations, our business could suffer.
Even if we are successful, litigation could result in substantial costs to us and could divert the time and attention of our management and other employees. Risks Related to Ownership of Our Common Stock The market price of our common stock has been and may be volatile, which could subject us to litigation.
Even if we are successful, litigation could result in substantial costs to us and could divert the time and attention of our management and other employees. 64 Table of Contents Risks Related to Ownership of Our Common Stock The market price of our common stock has been and may be volatile, which could subject us to litigation.
The State of Texas imposes CLIA requirements on laboratories operating within Texas but does not impose additional state licensure or registration requirements. 52 Table of Contents Additionally, all personnel involved in testing in our California laboratory must maintain a California state license or be supervised by licensed personnel.
The State of Texas imposes CLIA requirements on laboratories operating within Texas but does not impose additional state licensure or registration requirements. Additionally, all personnel involved in testing in our California laboratory must maintain a California state license or be supervised by licensed personnel.
We are highly dependent on information technology networks and systems, including a combination of on-site systems, managed data center systems and cloud-based data center systems, and the Internet, to securely process, transmit, and store a wide variety of 38 Table of Contents business-critical information, including research and development information, commercial information and business and financial information.
We are highly dependent on information technology networks and systems, including a combination of on-site systems, managed data center systems and cloud-based data center systems, and the Internet, to securely process, transmit, and store a wide variety of business-critical information, including research and development information, commercial information and business and financial information.
In particular, the laws and regulations governing the marketing and research of clinical diagnostic testing are extremely complex and in many instances there are no clear regulatory or judicial interpretations of these laws and regulations, increasing the risk that we may be found to be in violation of these laws.
In particular, the laws and regulations governing the marketing and research of clinical diagnostic 55 Table of Contents testing are extremely complex and in many instances there are no clear regulatory or judicial interpretations of these laws and regulations, increasing the risk that we may be found to be in violation of these laws.
Because it is unclear whether or how the PPACA may continue to evolve, be modified, or otherwise change, and whether and to what extent NIPT, cancer screening or other genetic screening may be affected, we are uncertain how our business may be impacted. In addition to the PPACA, various healthcare reform proposals have also emerged from federal and state governments.
Because it is unclear whether or how the PPACA may continue to evolve, be modified, or otherwise change, and whether and to what extent NIPT, cancer screening or other genetic screening may be affected, we are uncertain how our business may be impacted. 57 Table of Contents In addition to the PPACA, various healthcare reform proposals have also emerged from federal and state governments.
If our sales and marketing efforts are not successful outside of the United States, we may not achieve market acceptance for our tests outside of the United States, which would harm our business. 42 Table of Contents Operating internationally requires significant management attention and financial resources.
If our sales and marketing efforts are not successful outside of the United States, we may not achieve market acceptance for our tests outside of the United States, which would harm our business. Operating internationally requires significant management attention and financial resources.
In recent years we have developed and launched several new products or enhanced versions of existing products, including our first offerings and subsequent updated offerings in oncology and in organ health, and we expect to 32 Table of Contents continue our efforts in all of these areas.
In recent years we have developed and launched several new products or enhanced versions of existing products, including our first offerings and subsequent updated and new offerings in oncology and in organ health, and we expect to continue our efforts in all of these areas.
We cannot predict the ongoing extent, duration or severity of these conditions, nor the extent to which we may be impacted. ​ In the event of health epidemics or outbreaks in the future, our operations could be disrupted and our business adversely impacted.
We cannot predict the ongoing extent, duration or severity of these conditions, nor the extent to which we may be impacted. ​ 47 Table of Contents In the event of health epidemics or outbreaks in the future, our operations could be disrupted and our business adversely impacted.
Our current and future competitors could have greater technological, financial, reputational and market access advantages than us, and we may not be able to compete effectively 34 Table of Contents against them. Increased competition is likely to result in pricing pressures, which could harm our revenues, operating income or market share.
Our current and future competitors could have greater technological, financial, reputational and market access advantages than us, and we may not be able to compete effectively against them. Increased competition is likely to result in pricing pressures, which could harm our revenues, operating income or market share.
The PAMA rate reductions did not have a material impact on our business when they were implemented because our revenues from Medicare were very low at the time. The PAMA 53 Table of Contents reductions and reporting requirements were suspended in 2021 and have continued to be delayed, most recently until 2026.
The PAMA rate reductions did not have a material impact on our business when they were implemented because our revenues from Medicare were very low at the time. The PAMA reductions and reporting requirements were suspended in 2021 and have continued to be delayed, most recently until 2026.
We have incurred net losses each year since our inception in 2003. To date, we have financed our operations primarily through convertible debt and other debt instruments, our initial public offering, and our registered public equity offerings. Our net loss for the years ended December 31, 2024, 2023, and 2022 was $190.4 million, $434.8 million, and $547.8 million, respectively.
We have incurred net losses each year since our inception in 2003. To date, we have financed our operations primarily through convertible debt and other debt instruments, our initial public offering, and our registered public equity offerings. Our net loss for the years ended December 31, 2025, 2024, and 2023 was $208.2 million, $190.4 million, and $434.8 million, respectively.
Other U.S. companies in the medical device and pharmaceutical field have faced 41 Table of Contents criminal penalties under the FCPA for allowing their agents to deviate from appropriate practices in doing business with foreign government officials.
Other U.S. companies in the medical device and pharmaceutical field have faced criminal penalties under the FCPA for allowing their agents to deviate from appropriate practices in doing business with foreign government officials.
In addition, in some cases, our tests or their uses 46 Table of Contents within certain populations, such as for microdeletions, are considered experimental by third-party payers and, as a result, some payers have decided not to cover or reimburse for such tests.
In addition, in some cases, our tests or their uses within certain populations, such as for microdeletions, are considered experimental by third-party payers and, as a result, some payers have decided not to cover or reimburse for such tests.
We have worked to procure patents protecting our technologies, but our procurement efforts may not always be successful, 58 Table of Contents and any patents we successfully procure may be challenged in ways that lead to post-procurement scope reduction or invalidity.
We have worked to procure patents protecting our technologies, but our procurement efforts may not always be successful, and any patents we successfully procure may be challenged in ways that lead to post-procurement scope reduction or invalidity.
The Company is required to maintain a minimum of at least $150.0 million in its UBS accounts as collateral. UBS has the right to demand full or partial payment of the Credit Line obligations and terminate the Credit Line, in its discretion and without cause, at any time.
We are required to maintain a minimum of at least $150.0 million in our UBS accounts as collateral. UBS has the right to demand full or partial payment of the credit line obligations and terminate the credit line, in its discretion and without cause, at any time.
We employ individuals who were previously employed at other biotechnology or diagnostic companies, including our competitors in the various markets in which we operate. We may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or willfully used or disclosed confidential information of our employees’ former employers or other third parties.
We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information of third parties. We employ individuals who were previously employed at other biotechnology or diagnostic companies, including our competitors in the various markets in which we operate.
As further described in the risk factor entitled “ Uncertainty in the development and commercialization of our enhanced or new tests or services could materially adversely affect our business, financial condition and results of operations ,” completing such submissions requires the expenditure of time, attention and financial and other resources, and may not yield the desired results, which may delay, limit or prevent regulatory clearances, approvals or de novo classifications.
As further described in the risk factor entitled “ Uncertainty in the development and commercialization of our enhanced or new tests or services could materially adversely affect our business, financial condition and results of operations ,” completing such submissions requires the expenditure of time, attention and financial and other resources, and may not yield the desired results, which may delay, limit or prevent authorization.
Similarly, Panorama could provide a so-called false positive, which is a high-risk result for 39 Table of Contents a fetus that may not, in fact, have the relevant condition.
Similarly, Panorama could provide a so-called false positive, which is a high-risk result for a fetus that may not, in fact, have the relevant condition.
Total addressable market opportunity estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. Our publicly announced estimates and forecasts relating to the size and expected growth of our market may prove to be inaccurate.
Total addressable market opportunity estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. Our publicly announced estimates and forecasts relating to the size and expected growth of the markets in which we compete may prove to be inaccurate.
If we sell or 61 Table of Contents issue common stock, convertible securities, or other equity securities, or common stock is issued pursuant to equity incentive plans, investors in our common stock may be materially diluted.
If we sell or issue common stock, convertible securities, or other equity securities, or common stock is issued pursuant to equity incentive plans, investors in our common stock may be materially diluted.
As discussed in the risk factor entitled “ Regulatory and Compliance Risks—Failure to obtain necessary regulatory approvals may adversely affect our ability to expand our operations internationally, including our ability to continue commercializing our cloud-based distribution model,” the regulatory authorities in some of these countries may determine that such registration is required, which could impact our ability to offer Panorama in such countries.
As discussed in the risk factor entitled “ Regulatory and Compliance Risks—Failure to obtain necessary regulatory approvals may adversely affect our ability to expand our operations internationally,” the regulatory authorities in some of these countries may determine that such registration is required, which could impact our ability to offer Panorama in such countries.
We also had federal research and development credit carryforwards of approximately $83.3 million, which begin to expire in 2027, and state research and development credit carryforwards of approximately $45.6 million, which begin to expire in 2031.
We also had federal research and development credit carryforwards of approximately $83.6 million, which begin to expire in 2027, and state research and development credit carryforwards of approximately $48.9 million, which begin to expire in 2031.
The clinical laboratory testing industry is highly regulated, and failure to comply with applicable regulatory, supervisory, accreditation, registration or licensing requirements may adversely affect our business, financial condition and results of operations.
Changes in laws and regulations, or in their application, may adversely affect our business, financial condition and results of operations. The clinical laboratory testing industry is highly regulated, and failure to comply with applicable regulatory, supervisory, accreditation, registration or licensing requirements may adversely affect our business, financial condition and results of operations.
This process is conducted in various stages, and each stage presents the risk that we will not achieve our goals. We may not be successful in our current or future efforts to develop and commercialize cell-free DNA tests in industries that are newer to us.
This process is conducted in various stages, and each stage presents the risk that we will not achieve our goals. ​ 34 Table of Contents We may not be successful in our current or future efforts to develop and commercialize tests in industries that are newer to us.
For example, in 2020 we were notified of a data security incident that affected a third-party vendor, which affected a number of our patients whose protected health information was stored in such third-party vendor’s systems. The third-party vendor notified the affected individuals as required by HIPAA.
For example, in 2020 we were notified of a data security incident that affected a third-party vendor, which affected a number of our patients whose protected health information was stored in such third-party vendor’s systems.
In addition, new testing methods may be developed which may displace or be preferred over our current methods, such as whole genome sequencing or single cell analysis with respect to NIPTs, or tracking more tumor-specific variants and/or other biomarkers in addition to ctDNA, or testing without the need for a sample of the tumor tissue, with respect to MRD testing.
In addition, new testing methods may be developed which may displace or be preferred over our current methods, such as whole genome sequencing or single cell analysis with respect to NIPTs, or tracking more tumor-specific variants and/or other biomarkers in addition to ctDNA with respect to MRD testing.
If our operations, including the conduct of our employees, distributors, consultants and commercial partners, are found to be in violation of any laws or regulations that apply to us, we may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement of profits, exclusion from participation in federal health care programs, injunctions, recall or seizure of products, total or partial suspension of production, denial or withdrawal of pre-marketing product approvals, contractual damages, reputational harm, diminished profits and future earnings and the curtailment or restructuring of our operations, any of which could materially and adversely affect our business, financial condition and results of operations. 55 Table of Contents Failure to comply with privacy and security laws and regulations could result in fines, penalties and damage to our reputation and have a material adverse effect on our business.
If our operations, including the conduct of our employees, distributors, consultants and commercial partners, are found to be in violation of any laws or regulations that apply to us, we may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement of profits, exclusion from participation in federal health care programs, injunctions, recall or seizure of products, total or partial suspension of production, denial or withdrawal of pre-marketing product approvals, contractual damages, reputational harm, diminished profits and future earnings and the curtailment or restructuring of our operations, any of which could materially and adversely affect our business, financial condition and results of operations.
If the validity of an informed consent from a patient intake for Panorama or our other tests is challenged, we could be precluded from billing for such testing, forced to stop performing such tests, or required to repay amounts previously received, which would adversely affect our business and financial results.
An increase in the costs of compliance with such laws and regulations could harm our business and results of operations. 61 Table of Contents If the validity of an informed consent from a patient intake for Panorama or our other tests is challenged, we could be precluded from billing for such testing, forced to stop performing such tests, or required to repay amounts previously received, which would adversely affect our business and financial results.
If any of these events occur, our business, financial condition and results of operations could suffer. Further, some state laws impose anti-markup restrictions that prevent an entity from realizing a profit margin on outsourced testing. If we or our subsidiaries are unable to markup outsourced testing, our revenues and operating margins may suffer.
If any of these events occur, our business, financial condition and results of operations could suffer. Further, some state laws impose anti-markup restrictions that prevent an entity from realizing a profit margin on outsourced testing.
As of December 31, 2024, we have $80.4 million of outstanding balance of the Credit Line including accrued interest. The Credit Line is secured by a first priority lien and security interest in the Company’s money market and marketable securities held in its managed investment account with UBS.
As of December 31, 2025, we have $80.3 million of outstanding balance, including accrued interest, under our credit line with UBS. This credit line is secured by a first priority lien and security interest in our money market and marketable securities held in our managed investment account with UBS.
As of December 31, 2024, we had federal, state, and foreign NOL carryforwards of approximately $1.6 billion, $1.1 billion and $4.1 million, respectively, which, if not utilized, begin to expire in 2033, 2025, and 2027, respectively. Approximately $1.3 billion of these federal NOLs can be carried forward indefinitely.
As of December 31, 2025, we had federal, state, and foreign NOL carryforwards of approximately $2.0 billion, $1.4 billion and $4.5 million, respectively, which, if not utilized, begin to expire in 2030, 2026, and 2027, respectively. Approximately $1.7 billion of these federal NOLs can be carried forward indefinitely.
In particular, our sequencers, many of our reagents, including for Panorama, Horizon and Signatera as described below, and our blood collection tubes, are sole sourced. 36 Table of Contents For example, our molecular diagnostics tests are currently only validated to perform on Illumina’s sequencing platform; in addition, Illumina is currently the sole supplier of our sequencers and related reagents for Panorama, Horizon, Signatera and Prospera, along with certain hardware and software, pursuant to a supply agreement that expires in August 2033.
For example, our molecular diagnostics tests are currently only validated to perform on Illumina’s sequencing platform; in addition, Illumina is currently the sole supplier of our sequencers and related reagents for Panorama, Horizon, Signatera and Prospera, along with certain hardware and software, pursuant to a supply agreement that expires in August 2033.
Our cloud-based distribution model adds additional data privacy risk, as certain personal health and other information may be sent to and stored in the cloud by our laboratory licensees, many of which are located outside of the United States.
The third-party vendor notified the affected individuals as required by HIPAA. 41 Table of Contents Our cloud-based distribution model adds additional data privacy risk, as certain personal health and other information may be sent to and stored in the cloud by our laboratory licensees, many of which are located outside of the United States.
Future sales and issuances of our common stock or rights to purchase common stock, including pursuant to our equity incentive plans or in connection with acquisitions or strategic or commercial transactions, could result in additional dilution of the percentage ownership of our stockholders and could cause the price of our common stock to decline.
Any return to stockholders will therefore be limited to the increase, if any, in the price of our common stock. 66 Table of Contents Future sales and issuances of our common stock or rights to purchase common stock, including pursuant to our equity incentive plans or in connection with acquisitions or strategic or commercial transactions, could result in additional dilution of the percentage ownership of our stockholders and could cause the price of our common stock to decline.
Our business could be adversely affected while such review is ongoing and if we or our supplier are ultimately unable to obtain premarket clearance, approval or de novo classification.
Our business could be adversely affected while such review is ongoing and if we or our supplier are ultimately unable to obtain such authorization.
In addition, although there is a CPT code in place for microdeletions testing, we have experienced low average reimbursement rates for microdeletions under this CPT code, and we expect our microdeletions reimbursement to remain low, at least in the near term, due to third-party payers declining to reimburse and as a result of reduced reimbursement, under the code, which has had, and we expect to continue to have, an adverse effect on our revenues.
In addition, although there is a CPT code in place for microdeletions testing, we have experienced low average reimbursement rates for microdeletions under this CPT code, and we expect our microdeletions reimbursement to remain low, at least in the near term, due to third-party payers declining to reimburse and as a result of reduced reimbursement, under the code, which has had, and we expect to continue to have, an adverse effect on our revenues. ​ 49 Table of Contents The reimbursement environment, particularly for molecular diagnostics, is continually changing and our efforts to broaden reimbursement for our tests with third-party payers may not be successful.
Our overall test volumes grew from approximately 2,066,500 to 2,496,100 and further to 3,064,600 tests processed during the years ended 2022, 2023, and 2024, respectively, and since 2009 we have launched over 15 product offerings, enhancements, or indications. In addition, we regularly evaluate and refine our testing process, often significantly updating our workflows.
Our overall test volumes grew from approximately 2,496,100 to 3,064,600 and further to 3,525,500 tests processed during the years ended December 31, 2023, 2024, and 2025, respectively, and in recent years we have launched, and intend to continue to launch, product offerings, enhancements, and indications. In addition, we regularly evaluate and refine our testing process, often significantly updating our workflows.
These types of problems may be caused by a variety of factors, including infrastructure changes, human or software errors, viruses, security attacks, fraud, spikes in customer usage and denial of service issues.
These types of problems may be caused by a variety of factors, including infrastructure changes, human or software errors, viruses, security attacks, fraud, spikes in customer usage and denial of service issues. AWS HealthOmics is our backup for DNANexus, with both services relying on AWS.
As of December 31, 2024, we had an accumulated deficit of $2.6 billion. We may continue to experience such losses in the future as we continue to devote a substantial portion of our resources to efforts to increase the adoption of, and reimbursement for, our products, improve these products, and research and develop and commercialize new products.
We may continue to experience such losses in the future as we continue to devote a substantial portion of our resources to efforts to increase the adoption of, and reimbursement for, our products, improve these products, and research and develop and commercialize new products and acquire new technologies and businesses.
Any violations of these laws, or allegations of such violations, could disrupt our operations, involve significant management distraction, involve significant costs and expenses, including legal fees, and we could be subject to severe penalties, including criminal and civil penalties, disgorgement, and other remedial measures, any of which could result in a material adverse effect on our business, prospects, financial condition, or results of operations.
Any violations of these laws, or allegations of such violations, could disrupt our operations, involve significant management distraction, involve significant costs and expenses, including legal fees, and we could be subject to severe penalties, including criminal and civil penalties, disgorgement, and other remedial measures, any of which could result in a material adverse effect on our business, prospects, financial condition, or results of operations. 44 Table of Contents In addition, our international activities are subject to U.S. economic and trade sanctions, which restrict or otherwise limit our ability to do business in certain designated countries.
In addition, we are subject on an ongoing basis to federal, state and local regulations governing the use, storage, handling and disposal of these materials and specified hazardous waste materials. An increase in the costs of compliance with such laws and regulations could harm our business and results of operations.
In addition, we are subject on an ongoing basis to federal, state and local regulations governing the use, storage, handling and disposal of these materials and specified hazardous waste materials.
If our sales, distribution, development or other partnerships are not successful and we are not able to offset the resulting impact through our own efforts or through agreements with new partners, our commercialization activities may be impaired and our financial results could be adversely affected.
If we cannot effectively manage our expanding operations and our costs, we may not be able to grow successfully or we may grow at a slower pace, and our business could be adversely affected. 43 Table of Contents If our sales, distribution, development or other partnerships are not successful and we are not able to offset the resulting impact through our own efforts or through agreements with new partners, our commercialization activities may be impaired and our financial results could be adversely affected.
We or our partners or licensees may not be able to obtain regulatory approvals on a timely basis, if at all, which may cause us to incur additional costs or prevent us from marketing our tests in the United States or in foreign countries. 51 Table of Contents Changes in laws and regulations, or in their application, may adversely affect our business, financial condition and results of operations.
We or our partners or licensees may not be able to obtain regulatory approvals on a timely basis, if at all, which may cause us to incur additional costs or prevent us from marketing our tests in the United States or in foreign countries.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn addition to the oversight by our audit committee, our board of directors receives an annual report on cybersecurity matters from our Chief Technology Officer, or CTO.
Biggest changeOur management team provides updates on cybersecurity matters to our audit committee on a quarterly basis, with more frequent or interim communications as warranted. 69 Table of Contents In addition to the oversight by our audit committee, our board of directors receives an annual report on cybersecurity matters from our Chief Technology Officer, or CTO.
Our Information Security Execution Team conducts annual tabletop exercises to ensure preparedness for information security, including cybersecurity, incidents. In addition, we promote a company culture of awareness and discipline in cybersecurity matters through annual employee training and education, including periodic phishing simulations.
Our Information Security Execution Team conducts annual tabletop exercises to ensure preparedness for information security incidents. In addition, we promote a company culture of awareness and discipline in cybersecurity matters through annual employee training and education, including periodic phishing simulations.
Although we take measures to protect sensitive information from unauthorized access, use or disclosure, our information technology and infrastructure, and that of our technology and other third-party service providers and their 63 Table of Contents subcontractors, are nevertheless inherently vulnerable to, and from time to time experience, various cybersecurity threats.
Although we take measures to protect sensitive information from unauthorized access, use or disclosure, our information technology and infrastructure, and that of our technology and other third-party service providers and their subcontractors, are nevertheless inherently vulnerable to, and from time to time experience, various cybersecurity threats.
Management We maintain an Information Security Leadership Committee, or ISLC, that is accountable for enterprise-level information security risk strategy, identification, prioritization, and mitigation, including establishing objectives and 64 Table of Contents priorities. The ISLC comprises company executives that, collectively, represent experience and expertise in information technology, enterprise security and risk management, cybersecurity, engineering, technology, privacy, data security, and healthcare compliance.
Management We maintain an Information Security Leadership Committee, or ISLC, that is accountable for enterprise-level information security risk strategy, identification, prioritization, and mitigation, including establishing objectives and priorities. The ISLC comprises company executives that, collectively, represent experience and expertise in information technology, enterprise security and risk management, cybersecurity, engineering, technology, privacy, data security, and healthcare compliance.
Our audit committee is composed of directors with diverse expertise relevant to such committee’s responsibilities, and includes two directors who have expertise or certifications in cybersecurity. Our management team provides updates on cybersecurity matters to our audit committee on a quarterly basis, with more frequent or interim communications as warranted.
Our audit committee is composed of directors with diverse expertise relevant to such committee’s responsibilities, and includes two directors who have expertise or certifications in cybersecurity.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe premises will be used for laboratory and research use and commenced in December 2023. The annual lease payment starts at $ 0.5 million and increases annually. ​ As part of the in-process research and development, or the IPR&D, asset acquisition in September 2021, we inherited a 24-month lease for 7,107 square feet of laboratory space in Canada.
Biggest changeWe entered into a lease agreement in September 2023 to lease 16,319 square feet of space located in Pleasanton, California over a 60-month term. The premises will be used for laboratory and research use and commenced in December 2023. The annual lease payment starts at $ 0.5 million and increases annually.
For the facilities without a committed lease term, we have elected to not 65 Table of Contents recognize them as the right-of-use assets on the consolidated balance sheets as they are all considered short-term leases. For individual workspaces where the committed lease term exceeds one year, we have recorded a right-of-use asset.
For the facilities without a committed lease term, we have elected to not recognize them as the right-of-use assets on the consolidated balance sheets as they are all considered short-term leases. For individual workspaces where the committed lease term exceeds one year, we have recorded a right-of-use asset.
The annual lease payment starts at $0.2 million and expired in August 2023. ​ We have also historically entered into leases of individual workspaces and storage spaces at various locations on both a month-to-month basis without an established lease term, and more recently for certain locations, have committed to terms approximating one to five years.
We have also historically entered into leases of individual workspaces and storage spaces at various locations on both a month-to-month basis without an established lease term, and more recently for certain locations, have committed to terms approximating one to five years.
In December 2021, we entered into an amendment of the Austin lease agreement which extended the lease of the current premises through March 2033. The amendment also includes two additional office spaces, referred to as the First Expansion Premises and the Second Expansion Premises. The First Expansion Premises consists of 32,500 rentable square feet and commenced in February 2022.
The amendment also includes two additional office spaces, referred to as the First Expansion Premises and the Second Expansion Premises. The First Expansion Premises consists of 32,500 rentable square feet and commenced in February 2022. The Second Expansion Premises consists of 65,222 rentable square feet and commenced in September 2022.
In January 2023, we entered into an amendment to extend the lease term of the South San Francisco premises by three years, through November 2026. ​ We entered into a lease agreement in September 2023 to lease 16,319 square feet of space located in Pleasanton, California over a 60-month term.
The premises is used for general office, laboratory and research use. In December 2022, we exercised the renewal option of the South San Francisco lease agreement. In January 2023, we entered into an amendment to extend the lease term of the South San Francisco premises by three years, through November 2026.
The Second Expansion Premises consists of 65,222 rentable square feet and commenced in September 2022. The terms of the First and Second Expansion Premises expire in March 2033. ​ In the first quarter of 2025, we entered into new lease arrangements for additional space in Austin, Texas and San Carlos, California.
The terms of the First and Second Expansion Premises expire in March 2033. In March 2025, we entered into a lease agreement for additional premises of approximately 57,100 rentable square feet in Austin, Texas through March 2033 with an annual rent expense of approximately $0.9 million.
The annual rent will be approximately $9.7 million beginning January 2025, escalating annually and may be increased if we elect to utilize additional tenant improvement allowances. ​ In Tukwila, Washington, we leased a facility to provide storage of our cord blood tissue units.
The annual rent will be approximately $9.7 million beginning January 2025, escalating annually and may be increased if we elect to utilize additional tenant improvement allowances. In January 2025, we entered into a lease agreement for additional premises of approximately 40,700 rentable square feet in San Carlos, California, through November 2028 with an annual rent expense of approximately $1.5 million.
The new lease arrangements have future commitments aggregating to approximately $12.8 million through 2033. ​ We entered into a lease agreement in November 2020 to lease 11,395 square feet of space located in South San Francisco, California over a three-year term. The premises is used for general office, laboratory and research use.
In December 2025, the Company exercised its expansion right for an additional premises of approximately 28,468 rentable square feet in Austin, Texas through March 2033 with an annual rent expense of approximately $0.4 million. We entered into a lease agreement in November 2020 to lease 11,395 square feet of space located in South San Francisco, California over a three-year term.
As a result, we did not exercise the option to renew the facility upon expiration of the term in July 2023. ​ We lease laboratory and office space in Austin, Texas, comprising approximately 94,000 square feet pursuant to a lease expiring in November 2026.
We lease laboratory and office space in Austin, Texas, comprising approximately 94,000 square feet pursuant to a lease expiring in November 2026. In December 2021, we entered into an amendment of the Austin lease agreement which extended the lease of the current premises through March 2033.
Removed
The facility covers approximately 10,000 square feet, with a lease term of 62 months beginning in June 2018 and expired in July 2023. In the third quarter of 2019, we sold the Evercord business and the facility was subleased to a third party.
Added
In August 2025, we entered into a lease agreement for additional premises of approximately 45,800 rentable square feet in Austin, Texas through March 2033 with an annual rent expense of approximately $0.7 million.
Removed
In December 2022, we exercised the renewal option of the South San Francisco lease agreement.
Added
In December 2025, the Company entered in an amendment to extend the existing premises and expand to an additional premises of 15,485 rentable square feet in Pleasanton, California through March 2034.
Added
The combined annual lease payment will be approximately $0.9 million. 70 Table of Contents In December 2025, as part of the business combination, we assumed a lease agreement for approximately 25,718 square feet of space located in Boulder, Colorado. The premises are used for general office, laboratory, and research use.
Added
The lease term extends through June 2034, and the annual lease payments commence at approximately $1.5 million and escalate anually.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe results of such legal proceedings and claims cannot be predicted with certainty, and regardless of the outcome, legal proceedings could have an adverse impact on us because of defense and settlement costs, diversion of resources and other factors. ​ For information regarding certain current legal proceedings, see “Note 8—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements, which is incorporated herein by reference. ​ ITEM 4.
Biggest changeThe results of such legal proceedings and claims cannot be predicted with certainty, and regardless of the outcome, legal proceedings could have an adverse impact on us because of defense and settlement costs, diversion of resources and other factors. ​ For information regarding certain current legal proceedings, see “Note 10—Commitments and Contingencies—Legal Proceedings” in the Notes to Consolidated Financial Statements, which is incorporated herein by reference. ​ ITEM 4.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures ​ 66 ​ ​ ​ ​ ​ PART II ​ ​ ​ ​ ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ​ 66 Item 6. [Reserved.] ​ 67 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 68 Item 7A.
Biggest changeItem 4. Mine Safety Disclosures ​ 71 ​ ​ ​ ​ ​ PART II ​ ​ ​ ​ ​ ​ Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ​ 71 Item 6. [Reserved.] ​ 72 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 73 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk ​ 79 Item 8. Financial Statements and Supplementary Data ​ 80
Quantitative and Qualitative Disclosures About Market Risk ​ 84 Item 8. Financial Statements and Supplementary Data ​ 85

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe stock price performance on the following graph is not necessarily indicative of future stock price performance. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nasdaq Nasdaq Trade Date ​ Natera, Inc. ​ Biotechnology ​ Composite Base period 1/2/2020 ​ $ 100.00 ​ $ 100.00 ​ $ 100.00 12/31/2020 ​ $ 298.95 ​ $ 126.47 ​ $ 141.75 12/31/2021 ​ $ 278.97 ​ $ 125.67 ​ $ 172.07 12/31/2022 ​ $ 120.67 ​ $ 111.96 ​ $ 115.12 12/31/2023 ​ $ 188.16 ​ $ 116.14 ​ $ 165.10 12/31/2024 ​ $ 475.52 ​ $ 114.55 ​ $ 212.39 ​ Recent Sales of Unregistered Securities ​ None. ​ Purchases of Equity Securities by the Issuer and Affiliated Parties None. ​
Biggest changeThe stock price performance on the following graph is not necessarily indicative of future stock price performance. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Nasdaq ​ ​ ​ Nasdaq Trade Date ​ Natera, Inc. ​ Biotechnology ​ Composite Base period 1/4/2021 ​ $ 100.00 ​ $ 100.00 ​ $ 100.00 12/31/2021 ​ $ 96.97 ​ $ 99.96 ​ $ 123.20 12/31/2022 ​ $ 41.71 ​ $ 89.05 ​ $ 82.42 12/31/2023 ​ $ 65.04 ​ $ 92.38 ​ $ 118.21 12/31/2024 ​ $ 164.37 ​ $ 91.11 ​ $ 152.07 12/31/2025 ​ $ 237.87 ​ $ 120.63 ​ $ 183.03 ​ Recent Sales of Unregistered Securities ​ None. ​ Purchases of Equity Securities by the Issuer and Affiliated Parties None. ​
Any future determination to declare cash dividends will be made at the discretion of our board of directors, subject to applicable laws, and will depend on our financial condition, results of operations, capital requirements, general business conditions and other factors our board of directors may deem relevant. ​ ​ 66 Table of Contents Performance Graph ​ This performance graph shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or incorporated by reference into any of our other filings under the Exchange Act or the Securities Act except to the extent we specifically incorporate it by reference into such filing.
Any future determination to declare cash dividends will be made at the discretion of our board of directors, subject to applicable laws, and will depend on our financial condition, results of operations, capital requirements, general business conditions and other factors our board of directors may deem relevant. ​ 71 Table of Contents Performance Graph ​ This performance graph shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or incorporated by reference into any of our other filings under the Exchange Act or the Securities Act except to the extent we specifically incorporate it by reference into such filing.
The following graph compares the cumulative total stockholder return on our common stock over the five-year period ending on December 31, 2024, with the cumulative total return of (i) the NASDAQ Biotechnology Index and (ii) the NASDAQ Composite Index over the same period.
The following graph compares the cumulative total stockholder return on our common stock over the five-year period ending on December 31, 2025, with the cumulative total return of (i) the NASDAQ Biotechnology Index and (ii) the NASDAQ Composite Index over the same period.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES ​ Market Price of Our Common Stock ​ Our common stock is listed on the Nasdaq Global Select Market under the symbol “NTRA”. ​ Holders ​ As of January 31, 2025, we had 20 holders of record of our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES ​ Market Price of Our Common Stock ​ Our common stock is listed on the Nasdaq Global Select Market under the symbol “NTRA”. ​ Holders ​ As of January 31, 2026, we had 54 holders of record of our common stock.
The chart assumes $100 was invested at the close of market on January 2, 2020, and assumes the reinvestment of any dividends.
The chart assumes $100 was invested at the close of market on January 4, 2021, and assumes the reinvestment of any dividends.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe measurement of stock-based compensation is subject to periodic adjustments as the underlying equity instruments vest, and the resulting change in value, if any, is recognized in our statements of operations and comprehensive loss during the period that the related services are rendered. ​ 72 Table of Contents Results of Operations ​ Comparison of the years ended December 31, 2024, 2023, and 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ Changes (in thousands) 2024 2023 2022 2024 - 2023 ​ 2023 - 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount ​ Percent ​ ​ Amount ​ Percent ​ Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Product revenues $ 1,685,074 ​ $ 1,068,522 ​ $ 797,307 ​ ​ $ 616,552 ​ 57.7 % ​ $ 271,215 ​ 34.0 % Licensing and other revenues ​ 11,837 ​ ​ 14,049 ​ ​ 22,915 ​ ​ ​ (2,212) ​ (15.7) ​ ​ ​ (8,866) ​ (38.7) ​ Total revenues ​ 1,696,911 ​ ​ 1,082,571 ​ ​ 820,222 ​ ​ ​ 614,340 ​ 56.7 ​ ​ ​ 262,349 ​ 32.0 ​ Cost and expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cost of product revenues ​ 672,304 ​ ​ 588,564 ​ ​ 453,632 ​ ​ ​ 83,740 ​ 14.2 ​ ​ ​ 134,932 ​ 29.7 ​ Cost of licensing and other revenues ​ 1,449 ​ ​ 1,267 ​ ​ 2,624 ​ ​ ​ 182 ​ 14.4 ​ ​ ​ (1,357) ​ (51.7) ​ Research and development ​ 404,138 ​ ​ 320,678 ​ ​ 316,415 ​ ​ ​ 83,460 ​ 26.0 ​ ​ ​ 4,263 ​ 1.3 ​ Selling, general and administrative ​ 841,314 ​ ​ 618,307 ​ ​ 588,591 ​ ​ ​ 223,007 ​ 36.1 ​ ​ ​ 29,716 ​ 5.0 ​ Total cost and expenses ​ 1,919,205 ​ ​ 1,528,816 ​ ​ 1,361,262 ​ ​ ​ 390,389 ​ 25.5 ​ ​ ​ 167,554 ​ 12.3 ​ Loss from operations ​ (222,294) ​ ​ (446,245) ​ ​ (541,040) ​ ​ ​ 223,951 ​ 50.2 ​ ​ ​ 94,795 ​ 17.5 ​ Interest expense ​ (10,685) ​ ​ (12,638) ​ ​ (9,319) ​ ​ ​ 1,953 ​ 15.5 ​ ​ ​ (3,319) ​ (35.6) ​ Interest and other income, net ​ 43,248 ​ ​ 24,353 ​ ​ 3,538 ​ ​ ​ 18,895 ​ 77.6 ​ ​ ​ 20,815 ​ 588.3 ​ Loss before income taxes ​ (189,731) ​ ​ (434,530) ​ ​ (546,821) ​ ​ ​ 244,799 ​ 56.3 ​ ​ ​ 112,291 ​ 20.5 ​ Income tax expense ​ (695) ​ ​ (271) ​ ​ (978) ​ ​ ​ (424) ​ (156.5) ​ ​ ​ 707 ​ 72.3 ​ Net loss $ (190,426) ​ $ (434,801) ​ $ (547,799) ​ ​ $ 244,375 ​ 56.2 % ​ $ 112,998 ​ 20.6 % ​ Revenues ​ Total revenues are comprised of product revenues, which are primarily driven by sales of our Panorama and Horizon tests, oncology testing, and licensing and other revenues, which primarily includes development licensing revenue and licensing of our Constellation software.
Biggest changeRecent Accounting Pronouncements We believe that the impact of accounting standards updates recently issued that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. ​ 77 Table of Contents ​ Results of Operations ​ Comparison of the years ended December 31, 2025, 2024, and 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ Changes (in thousands) 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 ​ ​ 2025 - 2024 ​ ​ ​ ​ 2024 - 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ Amount ​ Percent ​ ​ Amount ​ Percent ​ Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Product revenues $ 2,295,820 ​ $ 1,685,074 ​ $ 1,068,522 ​ ​ $ 610,746 ​ 36.2 % ​ $ 616,552 ​ 57.7 % Licensing and other revenues ​ 10,293 ​ ​ 11,837 ​ ​ 14,049 ​ ​ ​ (1,544) ​ (13.0) ​ ​ ​ (2,212) ​ (15.7) ​ Total revenues ​ 2,306,113 ​ ​ 1,696,911 ​ ​ 1,082,571 ​ ​ ​ 609,202 ​ 35.9 ​ ​ ​ 614,340 ​ 56.7 ​ Cost and expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cost of product revenues ​ 810,627 ​ ​ 672,304 ​ ​ 588,564 ​ ​ ​ 138,323 ​ 20.6 ​ ​ ​ 83,740 ​ 14.2 ​ Cost of licensing and other revenues ​ 2,306 ​ ​ 1,449 ​ ​ 1,267 ​ ​ ​ 857 ​ 59.1 ​ ​ ​ 182 ​ 14.4 ​ Research and development ​ 624,110 ​ ​ 404,138 ​ ​ 320,678 ​ ​ ​ 219,972 ​ 54.4 ​ ​ ​ 83,460 ​ 26.0 ​ Selling, general and administrative ​ 1,177,261 ​ ​ 841,314 ​ ​ 618,307 ​ ​ ​ 335,947 ​ 39.9 ​ ​ ​ 223,007 ​ 36.1 ​ Amortization of acquired intangible assets ​ 1,720 ​ ​ — ​ ​ — ​ ​ ​ 1,720 ​ 100.0 ​ ​ ​ — ​ — ​ Total cost and expenses ​ 2,616,024 ​ ​ 1,919,205 ​ ​ 1,528,816 ​ ​ ​ 696,819 ​ 36.3 ​ ​ ​ 390,389 ​ 25.5 ​ Loss from operations ​ (309,911) ​ ​ (222,294) ​ ​ (446,245) ​ ​ ​ (87,617) ​ (39.4) ​ ​ ​ 223,951 ​ 50.2 ​ Interest expense ​ (4,069) ​ ​ (10,685) ​ ​ (12,638) ​ ​ ​ 6,616 ​ 61.9 ​ ​ ​ 1,953 ​ 15.5 ​ Interest and other income, net ​ 45,891 ​ ​ 43,248 ​ ​ 24,353 ​ ​ ​ 2,643 ​ 6.1 ​ ​ ​ 18,895 ​ 77.6 ​ Loss before income taxes ​ (268,089) ​ ​ (189,731) ​ ​ (434,530) ​ ​ ​ (78,358) ​ (41.3) ​ ​ ​ 244,799 ​ 56.3 ​ Income tax benefit (expense) ​ 59,929 ​ ​ (695) ​ ​ (271) ​ ​ ​ 60,624 ​ 8,722.9 ​ ​ ​ (424) ​ (156.5) ​ Net loss $ (208,160) ​ $ (190,426) ​ $ (434,801) ​ ​ $ (17,734) ​ (9.3) % ​ $ 244,375 ​ 56.2 % ​ Revenues ​ Total revenues are comprised of product revenues, which are primarily driven by sales of our Panorama and Horizon tests, Signatera and other oncology testing, and licensing and other revenues, which primarily includes development licensing revenue and licensing of our Constellation software.
A portion of our testing is performed by third-party laboratories. Our customers include independent laboratories, national and regional reference laboratories, medical centers and physician practices for our screening tests, research laboratories and pharmaceutical companies. We market and sell our tests through our direct sales force and, for our women’s health tests, through our laboratory distribution partners.
A portion of our testing is performed by third-party laboratories. Our customers include independent laboratories, national and regional reference laboratories, medical centers and physician practices for our screening tests, and research laboratories and pharmaceutical companies. We market and sell our tests through our direct sales force and, for our women’s health tests, through our laboratory distribution partners.
The Credit Line was amended in July 2017 and bears interest at 30-day LIBOR plus 1.10%, and it is secured by a first priority lien and security interest in our money market and marketable securities held in our managed investment account with UBS.
The Credit Line was amended in July 2017 and bears interest at 30-day LIBOR plus 1.10%, and it is secured by a first priority lien and security interest in our money market and marketable securities held in our managed investment account with UBS.
Our cell-free DNA, or cfDNA, technology combines our novel molecular assays, which reliably measure many informative regions across the genome from samples as small as a single cell, with our statistical algorithms, which incorporate data available from the broader scientific community to identify genetic variations covering a wide range of serious conditions with high accuracy and coverage.
Our cell-free DNA, or cfDNA, technology combines our novel molecular assays, which reliably measure many informative regions across the genome, from samples as small as a single cell, with our statistical algorithms that incorporate data available from the broader scientific community to identify genetic variations, covering a wide range of serious conditions with high accuracy and coverage.
These expenses consist of personnel costs, including stock-based compensation expense; direct marketing expenses; audit and legal expenses; consulting costs; training and medical education activities; payer outreach programs and allocated overhead, including rent, information technology, equipment depreciation, and utilities. ​ Interest Expense ​ Interest expense is attributable to borrowing under our Convertible Senior Notes (the “Convertible Notes”) and the credit line with UBS (the “Credit Line”), including the amortization of debt discounts. ​ Interest Income and Other (Expense) Income, Net ​ Interest income and other (expense) income, net is comprised of interest earned on our cash, realized gains and losses on investments and assets, sublease rental income, and foreign currency remeasurement gains and losses. ​ Critical Accounting Policies ​ Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States.
These expenses consist of personnel costs, including stock-based compensation expense; direct marketing expenses; audit and legal expenses; consulting costs; training and medical education activities; payer outreach programs and allocated overhead, including rent, information technology, equipment depreciation, and utilities. ​ Interest Expense ​ Interest expense is attributable to borrowing under our Convertible Senior Notes (the “Convertible Notes”) and the credit line with UBS (the “Credit Line”), including the amortization of debt discounts. ​ 76 Table of Contents Interest Income and Other (Expense) Income, Net ​ Interest income and other (expense) income, net is comprised of interest earned on our cash, realized gains and losses on investments and assets, sublease rental income, and foreign currency remeasurement gains and losses. ​ Critical Accounting Policies ​ Our management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States.
As of December 31, 2024, we have $20.0 million remaining and available on the Credit Line. ​ While we have introduced multiple products that are generating revenues, these revenues have not been sufficient to fund all operations. Accordingly, we have funded the portion of operating costs that exceeds revenues through a combination of equity issuances and debt and other financings.
As of December 31, 2025, we have $20.0 million remaining and available on the Credit Line. ​ While we have introduced multiple products that are generating revenues, these revenues have not been sufficient to fund all operations. Accordingly, we have funded the portion of operating costs that exceeds revenues through a combination of equity issuances and debt and other financings.
Payments due upon cancellation generally consist only of payments for services provided or expenses incurred, including non-cancellable obligations of our service providers, up to the date of cancellation. These payments have not been included separately within these contractual and other obligations disclosures. Please refer to Note 8, Commitments and Contingencies for further details.
Payments due upon cancellation generally consist only of payments for services provided or expenses incurred, including non-cancellable obligations of our service providers, up to the date of cancellation. These payments have not been included separately within these contractual and other obligations disclosures. Please refer to Note 10, Commitments and Contingencies for further details.
Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in “Risk Factors” included elsewhere in this report. ​ Overview ​ We are a diagnostics company with proprietary molecular and bioinformatics technology that we are applying to change the management of disease worldwide.
Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in “Risk Factors” included elsewhere in this report. ​ Overview ​ We are a diagnostics company with proprietary molecular and bioinformatics technology that we are applying to change disease management worldwide.
Please refer to Note 10, Debt , for further details. ​ Inventory purchase and other contractual obligations ​ We enter into contracts in the normal course of business with various third parties for clinical trials, preclinical research studies, testing, manufacturing, and other services for operational purposes.
Please refer to Note 12, Debt , for further details. ​ Inventory purchase and other contractual obligations ​ We enter into contracts in the normal course of business with various third parties for clinical trials, preclinical research studies, testing, manufacturing, and other services for operational purposes.
The leases have not commenced under Accounting Standards Codification, or ASC, Topic 842, Leases (ASC 842), as of December 31, 2024. As a result, these leases are not reflected within the consolidated balance sheets.
The leases have not commenced under Accounting Standards Codification, or ASC, Topic 842, Leases (ASC 842), as of December 31, 2025. As a result, these leases are not reflected within the consolidated balance sheets.
These improvements also reduced the frequency of the need to require blood redraws from the patient. 70 Table of Contents Cost of Licensing and Other Revenues ​ The components of our cost of licensing and other revenues are material costs associated with test kits sold to Constellation clients, development and support services relating to our strategic partnership agreements and other costs .
These improvements also reduced the frequency of the need to require blood redraws from the patient. ​ Cost of Licensing and Other Revenues ​ The components of our cost of licensing and other revenues are material costs associated with test kits sold to Constellation clients, development and support services relating to our strategic partnership agreements and other costs .
We used approximately $79.2 million of the net proceeds from the Convertible Notes offering to repay our obligations under our credit agreement with OrbiMed Royalty Opportunities II, LP. ​ The Convertible Notes are senior, unsecured obligations of the Company and bear interest at a rate of 2.25% per year, payable in cash semi-annually in arrears in May and November of each year, beginning in November 2020.
We used approximately $79.2 million of the net proceeds from the Convertible Notes offering to repay our obligations under our credit agreement with OrbiMed Royalty Opportunities II, LP. ​ The Convertible Notes were senior, unsecured obligations of the Company and bore interest at a rate of 2.25% per year, payable in cash semi-annually in arrears in May and November of each year, beginning in November 2020.
This increase in volume primarily represents continued commercial growth of Signatera, Panorama and Horizon, both as tests performed in our laboratories as well as through our Constellation software platform. ​ The percent of our revenues attributable to our U.S. direct sales force were 94%, 91% and 89% for the years ended December 31, 2024, 2023, and 2022, respectively.
This increase in volume primarily represents continued commercial growth of Signatera, Panorama and Horizon, both as tests performed in our laboratories as well as through our Constellation software platform. ​ The percent of our revenues attributable to our U.S. direct sales force were 95%, 94% and 91% for the years ended December 31, 2025, 2024, and 2023, respectively.
(2) Represents interest accrued on our Credit Line. (3) Represents various inventory purchase and other contractual obligations. Please refer to contractual commitments disclosures provided in Note 8, Commitments and Contingencies for additional information. ​ Off-Balance Sheet Arrangements ​ We do not have any off-balance sheet arrangements during the periods presented. ​ 78 Table of Contents
(2) Represents interest accrued on our Credit Line. (3) Represents various inventory purchase and other contractual obligations. Please refer to contractual commitments disclosures provided in Note 10, Commitments and Contingencies for additional information. ​ Off-Balance Sheet Arrangements ​ We do not have any off-balance sheet arrangements during the periods presented. ​ ​ 83 Table of Contents
We expect cost of product revenues in absolute dollars to increase as the number of tests we perform increases. As we continue to achieve scale, we have increased our focus on more efficient use of labor, automation, and DNA sequencing.
We expect cost of product revenues to increase as the number of tests we perform increases. ​ As we continue to achieve scale, we have increased our focus on more efficient use of labor, automation, and DNA sequencing.
Such arrangements include those related to our lease commitments, Credit Line (as defined below), commercial supply agreements and other agreements. ​ 77 Table of Contents Credit Line ​ The short-term debt obligations consist of the $80.4 million principal amount drawn from the UBS Credit Line, or the Credit Line, and applicable interest.
Such arrangements include those related to our lease commitments, Credit Line (as defined below), commercial supply agreements and other agreements. ​ 82 Table of Contents Credit Line ​ The short-term debt obligations consist of the $80.3 million principal amount drawn from the UBS Credit Line, or the Credit Line, and applicable interest.
The percent of our revenues attributable to U.S. laboratory partners for the years ended December 31, 2024, 2023, and 2022, was 4%, 6% and 7%, respectively. Our ability to increase our revenues and gross profit will depend on our ability to further penetrate the U.S. market with our direct sales force.
The percent of our revenues attributable to U.S. laboratory partners for the years ended December 31, 2025, 2024, and 2023, was 3%, 4% and 6%, respectively. Our ability to increase our revenues and gross profit will depend on our ability to further penetrate the U.S. market with our direct sales force.
Based on our current business plan, we believe that our existing cash and marketable securities will be sufficient to meet our anticipated cash requirements for at least 12 months after February 27, 2025. 75 Table of Contents Credit Line Agreement In September 2015, we entered into a Credit Line with UBS, or the Credit Line, providing for a $50.0 million revolving line of credit which could be drawn in increments at any time.
Based on our current business plan, we believe that our existing cash and marketable securities will be sufficient to meet our anticipated cash requirements for at least 12 months after February 26, 2026. 80 Table of Contents Credit Line Agreement In September 2015, we entered into a Credit Line with UBS, or the Credit Line, providing for a $50.0 million revolving line of credit which could be drawn in increments at any time.
Discussions of year-to-year comparisons between 2023 and 2022 that are not included in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 28, 2024. ​ Revenues ​ Product Revenues ​ We generate revenues from the sale of our tests, primarily from the sale of our Signatera, Panorama and HCS tests.
Discussions of year-to-year comparisons between 2024 and 2023 that are not included in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of Part II of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 27, 2025. ​ 74 Table of Contents Revenues ​ Product Revenues ​ We generate revenues from the sale of our tests, primarily from the sale of our Signatera, Panorama and HCS tests.
Most of our revenues have been denominated in U.S. dollars, though we generate some revenue in foreign currency, primarily denominated in Euros and Singapore Dollars. ​ Our net losses for the years ended December 31, 2024, 2023, and 2022, were $190.4 million, $434.8 million, and $547.8 million, respectively.
Most of our revenues have been denominated in U.S. dollars, though we generate some revenue in foreign currency, primarily denominated in Euros and Singapore Dollars. ​ Our net losses for the years ended December 31, 2025, 2024, and 2023, were $208.2 million, $190.4 million, and $434.8 million, respectively.
The percent of our revenues attributable to international laboratory partners and other international sales was 2%, 3% and 4% for the years ended December 31, 2024, 2023 and 2022, respectively. ​ For the year ended December 31, 2024, total revenues were $1,696.9 million, compared to $1,082.6 million and $820.2 million in the years ended December 31, 2023 and 2022, respectively.
The percent of our revenues attributable to international laboratory partners and other international sales was 2%, 2% and 3% for the years ended December 31, 2025, 2024 and 2023, respectively. ​ For the year ended December 31, 2025, total revenues were $2,306.1 million, compared to $1,696.9 million and $1,082.6 million in the years ended December 31, 2024 and 2023, respectively.
As of December 31, 2024, we had an accumulated deficit of $2.6 billion. ​ Components of the Results of Operations ​ The section of this Management’s Discussion and Analysis generally discusses year-to-year comparisons between 2024 and 2023.
As of December 31, 2025, we had an accumulated deficit of $2.8 billion. ​ Components of the Results of Operations ​ The section of this Management’s Discussion and Analysis generally discusses year-to-year comparisons between 2025 and 2024.
Many third-party payers do not currently reimburse for microdeletions screening in part because there has historically been limited published data on the performance of microdeletions screening tests, with our SMART study results being published relatively recently, in early 2022. ​ Entering into in-network contracts continues to be an important part of our business strategy, as we believe that in-network coverage of our tests by third-party payers is crucial to our growth and long-term success, as in-network pricing is more predictable than out-of-network pricing, enables us to develop stable, long-term relationships with third-party payers, and provides access to a larger population of covered lives.
Many third-party payers do not currently reimburse for microdeletions screening in part because there has historically been limited published data on the performance of microdeletions screening tests, with our single nucleotide polymorphism-based Microdeletion and Aneuploidy RegisTry, or SMART study results only being published in early 2022. ​ Entering into in-network contracts continues to be an important part of our business strategy, as we believe that in-network coverage of our tests by third-party payers is crucial to our growth and long-term success, as in-network pricing is more predictable than out-of-network pricing, enables us to develop stable, long-term relationships with third-party payers, and provides access to a larger population of covered lives.
For the years ended December 31, 2024, 2023, and 2022, there were no customers exceeding 10% of the total revenues on an individual basis. Revenues from customers outside the United States were $39.2 million, representing 2% of total revenues for the year ended December 31, 2024.
For the years ended December 31, 2025, 2024, and 2023, there were no customers exceeding 10% of the total revenues on an individual basis. Revenues from customers outside the United States were $41.8 million, representing 2% of total revenues for the year ended December 31, 2025.
As of December 31, 2024, the total principal amount outstanding with accrued interest was $80.4 million and $20.0 million is remaining and available under the Credit Line.
As of December 31, 2025, the total principal amount outstanding with accrued interest was $80.3 million and $20.0 million is remaining and available under the Credit Line.
For the year ended December 31, 2024, we had a net loss of $190.4 million, and we expect to continue to incur losses in future periods as we continue to devote a substantial portion of our resources to our research and development and commercialization efforts for our existing and new products.
For the year ended December 31, 2025, we had a net loss of $208.2 million, and we expect to continue to incur net losses in future periods as we continue to devote a substantial portion of our resources to our research and development and commercialization efforts for our existing and new products.
This included non-cash stock compensation expense of $274.4 million, $191.8 million, and $152.4 million for the years ended December 31, 2024, 2023, and 2022, respectively.
This included non-cash stock compensation expense of $354.4 million, $274.4 million, and $191.8 million for the years ended December 31, 2025, 2024, and 2023, respectively.
Revenues recognized from tests processed through our Constellation model, and from our strategic partnership agreements, are reported in licensing and other revenues. 69 Table of Contents In cases where we sell our tests through our laboratory partners, the majority of our laboratory partners bill the patient, clinic or insurance carrier for the performance of our tests, and we are entitled to either a fixed price per test or a percentage of their collections. ​ Our ability to increase our revenues will depend on our ability to further penetrate the domestic and international markets and, in particular, generate sales through our direct sales force, develop and commercialize additional tests, obtain reimbursement from additional third-party payers and increase our reimbursement rates for tests performed.
In cases where we sell our tests through our laboratory partners, the majority of our laboratory partners bill the patient, clinic or insurance carrier for the performance of our tests, and we are entitled to either a fixed price per test or a percentage of their collections. ​ Our ability to increase our revenues will depend on our ability to further penetrate the domestic and international markets and, in particular, generate sales through our direct sales force, develop and commercialize additional tests, obtain reimbursement from additional third-party payers and increase our reimbursement rates for tests performed.
For the year ended December 31, 2023, revenues from customers outside the United States were $34.9 million, representing approximately 3% of total revenues. For the year ended December 31, 2022, revenues from customers outside the United States were $34.4 million, representing approximately 4% of total revenues.
For the year ended December 31, 2024, revenues from customers outside the United States were $39.2 million, representing approximately 2% of total revenues. For the year ended December 31, 2023, revenues from customers outside the United States were $34.9 million, representing approximately 3% of total revenues.
Costs associated with Whole Exome Sequencing, or WES, are also included, as well as labor costs, relating to our Signatera CLIA and Signatera research use only offerings . Costs associated with performing tests are recorded when the test is accessioned. Costs associated with collection kits are recorded upon shipment to the clinics.
Costs associated with Whole Exome Sequencing, are also included, as well as labor costs, relating to our Signatera CLIA and Signatera research use only offerings. Costs associated with performing tests are recorded when the test is accessioned.
Operating leases Our future minimum lease payments consist of $140.6 million, as described in Note 7, Leases , which excludes $0.7 million of lease commitments related to payments for leases executed but not yet commenced to be paid over the respective terms of such leases.
Operating leases Our future minimum lease payments consist of $169.5 million, as described in Note 9, Leases , which excludes $1.5 million of lease commitments related to payments for leases executed but not yet commenced to be paid over the respective terms of such leases.
Total revenues for the year ended December 31, 2024 increased by $614.3 million, or 56.7%, when compared to the year ended December 31, 2023. We derive our revenues from tests based on units reported to customers—tests delivered with a result. All reported units are either accessioned in our laboratory or processed outside of our laboratory.
Total revenues for the year ended December 31, 2025 increased by $609.2 million, or 35.9%, when compared to the year ended December 31, 2024. We derive our revenues from tests based on units reported to customers—tests delivered with a result. All reported units are either accessioned in our laboratory or processed outside of our laboratory.
The number of tests that we process is a key metric as it tracks overall volume growth, particularly as our laboratory partners may transition from sending samples to our laboratory to our cloud- 68 Table of Contents based distribution model, as a result of which our tests accessioned would decrease but our tests processed would remain unchanged. ​ During the year ended December 31, 2024, we processed approximately 3,064,600 tests, comprised of approximately 3,001,900 tests accessioned in our laboratories.
The number of tests that we process is a key metric as it tracks overall volume growth, particularly as our laboratory partners may transition from sending samples to our laboratory to our cloud-based distribution model, as a result of which our tests accessioned would decrease but our tests processed would remain unchanged. ​ During the year ended December 31, 2025, we processed approximately 3,525,500 tests, comprised of approximately 3,468,700 tests accessioned in our laboratories.
Operating liabilities resulted in cash inflows of $9.0 million resulting from a $21.6 million increase in accrued compensation, a $10.3 million increase in other accrued liabilities, and a $5.0 million increase in deferred revenue, offset by a $15.5 million decrease in accounts payable and a $12.4 million decrease in operating lease liabilities. ​ Cash Provided by Investing Activities ​ Cash provided by investing activities for the year ended December 31, 2024 totaled $137.6 million, which was comprised of $24.8 million from proceeds from sale of investments and $314.4 million from proceeds of investment maturities, offset by $122.0 million in purchasing of new investments, $66.4 million in acquisitions of property and equipment, $2.7 million for investment in related party, and $10.5 million for an intangible asset acquisition. ​ Cash provided by investing activities for the year ended December 31, 2023 totaled $168.5 million, which was comprised of $306.0 million proceeds of investment maturities, offset by $98.3 million purchases of new investments and $39.2 million in cash paid for the purchase of property and equipment. ​ Cash Provided by Financing Activities ​ Cash provided by financing activities for the year ended December 31, 2024 totaled $30.2 million comprised of $13.0 million from proceeds from the exercise of stock options and $17.3 million from the issuance of common stock under our employee stock purchase plan, offset by $0.1 million related to cash redemption on the Convertible Notes. ​ Cash provided by financing activities for the year ended December 31, 2023 totaled $254.4 million comprised of $235.4 million net proceeds from our equity offering completed in the third quarter of 2023, $15.1 million in issuance of common stock under our employee stock purchase plan, and $3.9 million cash proceeds from the exercise of stock options. ​ Contractual Obligations and Other Commitments ​ We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods.
Operating liabilities resulted in cash inflows of $31.2 million resulting from a $13.2 million increase in accounts payable, a $40.3 million increase in accrued compensation, a $0.9 million increase in deferred revenue, offset by a $16.8 million decrease in lease liabilities and a $6.4 million decrease in other accrued liabilities. ​ Cash (Used in) Provided by Investing Activities ​ Cash used in investing activities for the year ended December 31, 2025 totaled $132.2 million, comprised of $106.2 million in acquisitions of property and equipment, $33.0 in purchase of intangible asset and $16.0 million in acquisition of business offset by $23.0 million from proceeds of investments maturities. ​ Cash provided by investing activities for the year ended December 31, 2024 totaled $137.6 million, which was comprised of $24.8 million from proceeds from sale of investments and $314.4 million from proceeds of investment maturities, offset by $122.0 million in purchasing of new investments, $66.4 million in acquisitions of property and equipment, $2.7 million for investment in related party, and $10.5 million for an intangible asset acquisition. ​ Cash Provided by Financing Activities ​ Cash provided by financing activities for the year ended December 31, 2025 totaled $47.5 million comprised of $22.5 million from proceeds from the exercise of stock options and $25.0 million from the issuance of common stock under our employee stock purchase plan, offset by $0.1 million related to stock issuance costs. ​ Cash provided by financing activities for the year ended December 31, 2024 totaled $30.2 million comprised of $13.0 million from proceeds from the exercise of stock options and $17.3 million from the issuance of common stock under our employee stock purchase plan, offset by $0.1 million related to cash redemption on the Convertible Notes. ​ Contractual Obligations and Other Commitments ​ We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods.
As noted in the section titled “Overview” above, the number of tests that we process is a key metric as it tracks our overall volume growth. During the year ended December 31, 2024, total reported units were approximately 2,926,400, comprised of approximately 2,867,400 tests reported in our laboratories.
As noted in the section titled “Overview” above, the number of tests that we process is a key metric as it tracks our overall volume growth. During the year ended December 31, 2025, total reported units were approximately 3,342,500, comprised of approximately 3,288,600 tests reported in our laboratories.
The decrease was primarily due to a decrease in revenue from our collaborative agreements. ​ Cost of Product Revenues ​ During the year ended December 31, 2024, cost of product revenues increased by $83.7 million or 14.2% when compared to the year ended December 31, 2023, primarily due to higher costs related to inventory consumption of $28.1 million driven by an increase in accessioned cases, a $32.0 million increase in third-party fees, a $23.6 million increase in shipping, equipment and related depreciation expense, labor, overhead, and other related costs driven by headcount growth and product support. ​ Cost of Licensing and Other Revenues ​ Cost of licensing and other revenues for the year ended December 31, 2024, when compared to the year ended December 31, 2023, increased by approximately $0.2 million, or 14.4%, primarily due to a net increase in costs to support our collaborative agreements. ​ Expenses ​ Research and Development ​ Research and development expenses during the year ended December 31, 2024 increased by $83.5 million, or 26.0%, when compared to the year ended December 31, 2023.
The decrease was primarily due to the termination of certain collaborative agreements. ​ Cost of Product Revenues ​ During the year ended December 31, 2025, cost of product revenues increased by $138.3 million or 20.6% when compared to the year ended December 31, 2024, primarily due to higher costs related to inventory consumption of $57.2 million driven by an increase in accessioned cases, a $23.7 million increase in third-party fees, a $57.4 million increase in shipping, equipment and related depreciation expense, labor, overhead, and other related costs driven by headcount growth and product support. ​ Cost of Licensing and Other Revenues ​ Cost of licensing and other revenues for the year ended December 31, 2025, when compared to the year ended December 31, 2024, increased by approximately $0.9 million, or 59.1%, primarily due to a net increase in costs to support our collaborative agreements. ​ Expenses ​ Research and Development ​ Research and development expenses during the year ended December 31, 2025 increased by $220.0 million, or 54.4%, when compared to the year ended December 31, 2024.
The remaining Convertible Notes not converted under the redemption notice were redeemed in exchange for cash at face value plus any accrued interest totaling $0.1 million. ​ Cash Flows ​ The following table summarizes our cash flows for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ December 31, ​ ​ 2024 2023 ​ 2022 ​ ​ (in thousands) Cash provided by (used in) operating activities ​ $ 135,664 ​ $ (246,955) ​ $ (431,501) ​ Cash provided by investing activities ​ 137,624 ​ 168,498 ​ ​ 330,338 ​ Cash provided by financing activities ​ 30,204 ​ 254,461 ​ ​ 482,640 ​ Net change in cash, cash equivalents and restricted cash ​ 303,492 ​ ​ 176,004 ​ ​ 381,477 ​ Cash, cash equivalents and restricted cash, beginning of period ​ 642,095 ​ 466,091 ​ ​ 84,614 ​ Cash, cash equivalents and restricted cash, end of year ​ $ 945,587 ​ $ 642,095 ​ $ 466,091 ​ ​ 76 Table of Contents Cash Provided by (Used in) Operating Activities ​ Cash provided by operating activities during the year ended December 31, 2024 was $135.7 million.
The remaining Convertible Notes not converted under the redemption notice were redeemed in exchange for cash at face value plus any accrued interest totaling $0.1 million. ​ Cash Flows ​ The following table summarizes our cash flows for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ ​ December 31, ​ ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ 2023 ​ ​ (in thousands) Cash provided by (used in) operating activities ​ $ 215,301 ​ $ 135,664 ​ $ (246,955) ​ Cash (used in) provided by investing activities ​ (132,209) ​ 137,624 ​ ​ 168,498 ​ Cash provided by financing activities ​ 47,461 ​ 30,204 ​ ​ 254,461 ​ Net change in cash, cash equivalents and restricted cash ​ 130,553 ​ ​ 303,492 ​ ​ 176,004 ​ Cash, cash equivalents and restricted cash, beginning of period ​ 945,587 ​ 642,095 ​ ​ 466,091 ​ Cash, cash equivalents and restricted cash, end of year ​ $ 1,076,140 ​ $ 945,587 ​ $ 642,095 ​ ​ 81 Table of Contents Cash Provided by (Used in) Operating Activities ​ Cash provided by operating activities during the year ended December 31, 2025 was $215.3 million.
Comparatively, during the year ended December 31, 2023, total reported units were approximately 2,388,200, comprised of approximately 2,323,400 tests reported in our laboratories. During the year ended December 31, 2024 and 2023, total oncology units processed were approximately 528,200 and 341,000 respectively.
Comparatively, during the year ended December 31, 2024, total reported units were approximately 2,926,400, comprised of approximately 2,867,400 tests reported in our laboratories. During the year ended December 31, 2025 and 2024, total oncology units processed were approximately 800,800 and 528,200, respectively.
We aim to make personalized genetic testing and diagnostics part of the standard of care to protect health and inform earlier and more targeted interventions that help lead to longer, healthier lives. ​ We currently provide a comprehensive suite of products in women’s health, oncology, and organ health, and our Constellation cloud-based platform.
We aim to make personalized genetic testing and diagnostics part of the standard of care to protect health and inform earlier and provide more targeted interventions that help lead to longer, healthier lives. ​ We provide a comprehensive suite of products to improve patient care outcomes in three main areas of healthcare – oncology, women’s health, and organ health.
Product Revenues ​ During the year ended December 31, 2024, product revenues increased by $616.6 million, or 57.7% compared to the year ended December 31, 2023, as a result of the continued revenue growth from increased test volumes as well as average selling price improvements. ​ 73 Table of Contents Licensing and Other Revenues ​ Licensing and other revenues decreased by $2.2 million, or 15.7%, during the year ended December 31, 2024 compared to the year ended December 31, 2023.
Product Revenues ​ During the year ended December 31, 2025, product revenues increased by $610.7 million, or 36.2%, compared to the year ended December 31, 2024, as a result of the continued revenue growth from increased test volumes as well as average selling price improvements. ​ 78 Table of Contents Licensing and Other Revenues ​ Licensing and other revenues decreased by $1.5 million, or 13.0%, during the year ended December 31, 2025 compared to the year ended December 31, 2024.
Product revenues generated from our testing accounted for $1,685.1 million or 99% of total revenues for the year ended December 31, 2024, compared to $1,068.5 million or 99% of total revenues for the year ended December 31, 2023 and $797.3 million or 97% of total revenues for the year ended December 31, 2022.
Product revenues generated from our testing accounted for $2,295.8 million or nearly 100% of total revenues for the year ended December 31, 2025, compared to $1,685.1 million or 99% of total revenues for the year ended December 31, 2024 and $1,068.5 million or 99% of total revenues for the year ended December 31, 2023.
Operating liabilities resulted in cash inflows of $31.2 million resulting from a $13.2 million increase in accounts payable, a $40.3 million increase in accrued compensation, a $0.9 million increase in deferred revenue, offset by a $16.8 million decrease in lease liabilities and a $6.4 million decrease in other accrued liabilities.
Operating liabilities had cash inflows of $14.6 million resulting from a $60.3 million increase in accrued compensation, a $0.8 million increase in accounts payable, a $31.3 million increase in other accrued liabilities, and a $2.8 million increase in deferred revenue, offset by a $60.8 million decrease in deferred tax liability and a $19.8 million decrease in lease liabilities.
As of December 31, 2024, we had an accumulated deficit of $2.6 billion. As of December 31, 2024, we had $945.6 million in cash and cash equivalents and restricted cash, $22.7 million in marketable securities, and $80.4 million of outstanding balance on the Credit Line including accrued interest.
As of December 31, 2025, we had an accumulated deficit of $2.8 billion. As of December 31, 2025, we had $1.1 billion in cash and cash equivalents and restricted cash, and $80.3 million of outstanding balance on the Credit Line including accrued interest.
During the year ended December 31, 2023, we processed approximately 2,496,100 tests, comprised of approximately 2,426,500 tests accessioned in our laboratories. During the year ended December 31, 2022, we processed approximately 2,066,500 tests, comprised of approximately 2,004,000 tests accessioned in our laboratories.
During the year ended December 31, 2024, we processed approximately 3,064,600 tests, comprised of approximately 3,001,900 tests accessioned in our laboratories. During the year ended December 31, 2023, we processed approximately 2,496,100 tests, comprised of approximately 2,426,500 tests accessioned in our laboratories.
We generate a majority of our revenues from the sale of Panorama, our non-invasive prenatal test, or NIPT, as well as Horizon, our Carrier Screening test.
We generate the majority of our revenues from the sale of Panorama, our non-invasive prenatal test (“NIPT”) and Horizon, our genetic carrier screening test.
The following table summarizes our contractual commitments as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payments Due by Period ​ ​ Less Than 1 to 3 3 to 5 More Than ​ ​ Total ​ 1 Year ​ Years ​ Years ​ 5 Years ​ ​ (in thousands) Short-term debt obligations (1) ​ $ 80,000 ​ $ 80,000 ​ $ — ​ $ — ​ $ — ​ Interest accrued on debt (2) ​ ​ 362 ​ ​ 362 ​ ​ — ​ ​ — ​ ​ — ​ Inventory purchase and other contractual obligations (3) ​ 171,262 ​ 113,818 ​ 44,085 ​ 11,359 ​ 2,000 ​ Total ​ $ 251,624 ​ $ 194,180 ​ $ 44,085 ​ $ 11,359 ​ $ 2,000 ​ ​ (1) Represents proceeds drawn from our Credit Line.
The following table summarizes our contractual commitments as of December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payments Due by Period ​ ​ ​ ​ ​ ​ ​ ​ Less Than ​ ​ ​ 1 to 3 ​ ​ ​ 3 to 5 ​ ​ ​ More Than ​ ​ Total ​ 1 Year ​ Years ​ Years ​ 5 Years ​ ​ (in thousands) Short-term debt obligations (1) ​ $ 80,000 ​ $ 80,000 ​ $ — ​ $ — ​ $ — ​ Interest accrued on debt (2) ​ ​ 323 ​ ​ 323 ​ ​ — ​ ​ — ​ ​ — ​ Inventory purchase and other contractual obligations (3) ​ 256,942 ​ 171,251 ​ 78,315 ​ 4,793 ​ 2,583 ​ Total ​ $ 337,265 ​ $ 251,574 ​ $ 78,315 ​ $ 4,793 ​ $ 2,583 ​ ​ (1) Represents proceeds drawn from our Credit Line.
This cloud-based distribution model results in lower revenues and gross profit per test than cases in which we process a test ourselves; however, because we do not incur the costs of processing the tests, our costs per test under this model are also lower.
This cloud-based distribution model results in lower revenues and gross profit per test than cases in which we process a test ourselves; however, because we do not incur the costs of processing the tests, our costs per test under this model are also lower. ​ ​ 73 Table of Contents The principal focus of our commercial operations is to offer our tests through both our direct sales force and laboratory distribution partners, and our Constellation licensees under our cloud-based distribution model.
Expenses ​ Research and Development ​ Research and development expenses include costs incurred to develop our technology, collect clinical samples and conduct clinical studies to develop and support our products.
We expect our cost of licensing will increase in relation to volume growth. ​ Expenses ​ Research and Development ​ Research and development expenses include costs incurred to develop our technology, collect clinical samples and conduct clinical studies to develop and support our products.
Operating assets had cash outflows of $57.0 million resulting from $33.9 million in increases in accounts receivable, $5.4 million in increases in inventory, and $26.1 million in increases in prepaid expenses and other current assets, offset by $8.4 million from cash inflows in operating lease right-of-use assets.
Operating assets had cash outflows of $4.6 million resulting from a $20.9 million increase in inventory and a $8.6 million increase in prepaid expenses and other assets, offset by a $20.7 million decrease in accounts receivable and a $4.2 million decrease in operating lease right-of-use assets.
We intend to mitigate any impact by driving more business from our most profitable accounts. ​ Licensing and Other Revenues ​ Revenues recognized from tests processed through our Constellation model, and from our strategic partnership agreements (which during the three years ended December 31, 2024, 2023 and 2022 comprised BGI Genomics Co.
We intend to mitigate any impact by driving more business from our most profitable accounts. ​ Licensing and Other Revenues ​ Revenues recognized from tests processed through our Constellation model, and from our strategic partnership agreements are reported in licensing and other revenues.
We currently have 7 revenue generating licensing and service agreements with laboratories under our Constellation distribution model. We consider our cost of licensing and other revenues for the Constellation software platform to be relatively low, and therefore we expect its associated gross margin is higher. We expect our cost of licensing will increase in relation to volume growth.
We consider our cost of licensing and other revenues for the Constellation software platform to be relatively low, and therefore we expect its associated gross margin is higher.
The increase was driven by a $48.3 million increase in salary and related expenditures, which includes a $24.2 million increase in stock-based compensation expense, a $25.7 million increase in lab and clinical trial related expenses, a $6.7 million increase in consulting expenses, and a $2.8 million net increase in office, facilities, and other expenses. ​ Selling, General and Administrative ​ Selling, general and administrative expenses increased by $223.0 million, or 36.1%, in the year ended December 31, 2024 compared to the year ended December 31, 2023.
The increase was attributable to an increase of $127.3 million in salary and related compensation expenditures (including a $32.0 million increase in stock-based compensation expense), a $19.4 million increase in consulting expenses, a $21.6 million increase in office related expenses, a $40.9 million increase in lab related and clinical trial expenses, a $6.5 million net increase in facilities related expenses and a $4.3 million increase in travel and other expenses. ​ Selling, General and Administrative ​ Selling, general and administrative expenses increased by $335.9 million, or 39.9%, in the year ended December 31, 2025 compared to the year ended December 31, 2024.
Stock-Based Compensation Attributable to Performance-Based Awards Stock-based compensation expense for restricted stock units and stock options with performance metrics is calculated based upon probability of achievement of the metrics specified in the grant. The fair value is recognized as expense over the requisite service period, which is generally the vesting period of the respective awards.
Stock-Based Compensation Attributable to Performance-Based Awards Stock-based compensation expense for restricted stock units and stock options with performance metrics is calculated based upon probability of achievement of the metrics specified in the grant. Stock-based compensation expense for performance-based awards is recognized when it becomes probable that the performance conditions will be met.
In addition to Panorama and Horizon, our product offerings in women’s health include Spectrum Preimplantation Genetics, our Anora miscarriage test, and Vistara single-gene NIPT, as well as our Empower hereditary cancer screening test, which we also offer through our oncology sales channel.
In addition to Panorama, our product offerings in women’s health include Fetal Focus, our noninvasive prenatal test for single-gene inherited conditions, Vistara, our single-gene NIPT that screens for conditions that may affect quality of life, and Anora, our test to help determine underlying reasons for occurrence of miscarriage, and Empower, our hereditary cancer screening test which we also offer through our oncology sales channel.
The Convertible Notes mature in May 2027, unless earlier converted, repurchased or redeemed in accordance with their terms. Upon conversion, the Convertible Notes are convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, at our election.
Upon conversion, the Convertible Notes were convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, at our election.
Cash used in operating activities during the year ended December 31, 2023 was $247.0 million.
Cash provided by operating activities during the year ended December 31, 2024 was $135.7 million.
As of December 31, 2024, we are recognizing revenues on 7 licensing and service arrangements with laboratories under our Constellation model. ​ Our strategy to offer access to our algorithm to laboratory licensees via our Constellation cloud-based software platform may also cause our revenues to decrease because we do not process the tests and perform the molecular biology analysis in our own laboratory under this model, and therefore are not able to charge as high an amount, and as a result realize lower revenues per test than when we perform the entire test ourselves.
We also recognize licensing revenues through the licensing and the provisioning of services to support the use of our proprietary technology by licensees under our cloud-based distribution model. ​ Our strategy to offer access to our algorithm to laboratory licensees via our Constellation cloud-based software platform may also cause our revenues to decrease because we do not process the tests and perform the molecular biology analysis in our own laboratory under this model, and therefore are not able to charge as high an amount and, as a result, realize lower revenues per test than when we perform the entire test ourselves. ​ 75 Table of Contents Cost of Product Revenues ​ The components of our cost of product revenues are material and service costs, depreciation charges associated with testing equipment, personnel costs, including stock-based compensation expense, equipment and infrastructure expenses associated with testing samples, electronic medical records, order and delivery systems, shipping charges to transport samples, costs incurred from third party test processing fees, and allocated overhead such as rent, information technology costs, leasehold depreciation and utilities.
The increase was attributable to a $124.4 million increase in salary and related expenditures, which includes a $55.5 million increase in stock-based compensation expense, a $57.2 million increase in consulting and legal expenses, a $8.9 million increase in marketing costs, a $7.4 million increase in travel expenses, a $7.4 million increase in office related expenses, a $16.5 million increase in vendor expenses, and a $1.2 million net increase in facilities and other costs. ​ Interest Expense ​ Interest expense decreased by $2.0 million, 15.5%, in the year ended December 31, 2024 compared to the same period in the prior year primarily as a result of the slight decrease in interest rate and the redemption of the Convertible Notes in October 2024. ​ Interest and Other Income ​ Interest and other income increased by $18.9 million, or 77.6%, in the year ended December 31, 2024, compared to the same period in the prior year, primarily due to greater average cash and investment balances driving higher interest income. ​ 74 Table of Contents Liquidity and Capital Resources ​ We have incurred net losses each year since our inception.
The increase was attributable to an increase of $212.6 million in salary and related compensation expenditures (including a $41.1 million increase in stock-based compensation expense), a $25.2 million increase in consulting expenses, a $28.5 million increase in marketing expenses, a $8.7 million increase in travel related costs, a $14.5 million increase in office costs, a $9.4 million increase in vendor expenses, a $30.6 million increase in legal related expenses, and a $6.4 million increase in facilities and other costs. ​ Amortization of Acquired Intangibles ​ Amortization of acquired intangibles increased by $1.7 million, or 100%, in the year ended December 31, 2025 compared to the year ended December 31, 2024.
The net loss of $434.8 million includes $235.8 million in non-cash charges resulting from $24.1 million of depreciation and amortization, $2.7 million milestone expense for in-process research and development, $14.5 million of non-cash lease expense, $191.8 million of stock-based compensation expense, $1.1 million premium amortization and discount accretion on investment securities, $0.3 million in foreign exchange adjustment, and $1.3 million for amortization of debt discount.
The net loss of $208.2 million includes $413.5 million in non-cash charges resulting from $41.8 million of depreciation and amortization, $1.7 million of amortization of acquired intangibles, $354.4 million of stock-based compensation expense, $20.2 million of non-cash lease expense, offset by a $3.2 million change in fair value of warrants and preferred stock and a $1.4 million decrease in non-cash expense recovery.
We also offer our Signatera molecular residual disease test for oncology applications, which we commercialize as a test run in our CLIA (as defined below) laboratories and offer on a research use only basis to research laboratories and pharmaceutical companies; and our Prospera organ transplant assessment tests. ​ We process tests in our laboratories certified under the Clinical Laboratory Improvement Amendments of 1988 (or CLIA) in Austin, Texas and San Carlos, California.
We also offer Latitude, our blood-based MRD test for colorectal cancer that does not require a tumor tissue sample, as well as Altera, a comprehensive genomic profiling test to support treatment decisions and therapy selection. ​ We process tests in our laboratories certified under the Clinical Laboratory Improvement Amendments of 1988, or CLIA, primarily in Austin, Texas and San Carlos, California; our laboratory in Boulder, Colorado performs clinical trials testing.
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We began entering into these licensing arrangements starting in the fourth quarter of 2015. ​ The principal focus of our commercial operations is to offer our tests through both our direct sales force and laboratory distribution partners, and our Constellation licensees under our cloud-based distribution model.
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In oncology, we offer Signatera, our personalized ctDNA blood test for MRD assessment, early recurrence monitoring, and evaluation of treatment response in patients previously diagnosed with cancer.
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Ltd., and Foundation Medicine, Inc. agreements) are reported in licensing and other revenues. We also recognize licensing revenues through the licensing and the provisioning of services to support the use of our proprietary technology by licensees under our cloud-based distribution model.
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Revenues recognized from tests processed through our Constellation model, and from our strategic partnership agreements, are reported in licensing and other revenues.
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However, cost of licensing and other revenues for the Constellation software platform are relatively low, and therefore, its associated gross margin is higher. ​ Cost of Product Revenues The components of our cost of product revenues are material and service costs, equipment and related depreciation expense, personnel costs, including stock-based compensation expense, and infrastructure expenses associated with testing samples, electronic medical records, order and delivery systems, shipping charges to transport samples, costs incurred from third party test processing fees, and allocated overhead such as rent, information technology costs, equipment depreciation and utilities.
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We consider our critical accounting policies and estimates to be revenue recognition, stock-based compensation attributable to performance-based awards, and certain management assumptions used in the estimation of the fair value of intangible assets acquired in a business combination.
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We consider our critical accounting policies and estimates to be product revenues recognition and stock-based compensation attributable to restricted stock units and stock options with performance metrics. 71 Table of Contents Recent Accounting Pronouncements We believe that the impact of accounting standards updates recently issued that are not yet effective will not have a material impact on our financial position or results of operations upon adoption.
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Product Revenues The total consideration the Company expects to collect in exchange for the Company’s products is an estimate and may be fixed or variable. Consideration includes reimbursement from both patients and insurance carriers, adjusted for variable considerations related to disallowed cases, percent of patient responsibility collected, refunds and reserves, and is estimated using the expected value method.
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Revenue Recognition We recognize revenues when, or as, performance obligations in the contracts are satisfied, in the amount reflecting the expected consideration to be received from the goods or services transferred to the customers.
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For insurance carriers and product types with similar reimbursement characteristics, the Company uses a portfolio of relevant historical data to estimate variable consideration and total collections for the Company’s products. The Company constrains the estimated variable consideration when it determines it is probable that a significant reversal in the amount of cumulative revenue recognized may occur in future periods.
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Product Revenues Product revenues are derived by performing genetic testing services and our performance obligation is complete when test results are delivered to a clinic or patient, who are considered the customer for such services. We enter into contracts with insurance carriers with primarily payment terms related to tests provided to the patients who have health insurance coverage.
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The fair value is recognized as expense over the requisite service period, which is generally the vesting period of the respective awards.
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Insurance carriers are considered to be third-party payers on behalf of the patients, and the patients are considered as the customers who receive genetic test services. Tests may be billed to insurance carriers, patients, or a combination of insurance carriers and patients.
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The measurement of stock-based compensation is subject to potential adjustment based on the underlying equity instruments that ultimately vest, with the resulting change in value, if any, recognized in our statements of operations and comprehensive loss during the period that the related services are rendered.
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Further, we sell tests to a number of domestic and international laboratory partners and identify the laboratory partners as customers provided that there is a test services agreement between us and them.
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Valuation of Intangible Assets Acquired in a Business Combination In conjunction with the completion of the Company’s acquisition of Foresight Diagnostics in December 2025, we acquired a developed technology intangible asset for which we determined the acquisition date fair value using a multi-period excess earnings income approach valuation model that discounts expected future cash flows to present value.
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No compensation cost is recognized on stock options for employees and non-employees who do not render the requisite service and therefore forfeit their rights to the stock options.
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The expected future cash flows used in the valuation model include significant assumptions that form the basis of the forecasted results, principally the clinical revenue and related growth rate. These significant assumptions are forward-looking and could be affected by future economic and market conditions.
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In November 2022, we completed an underwritten equity offering and sold 13,144,500 shares of our common stock at a price of $35 per share to the public. Before offering expenses of approximately $0.5 million, we received proceeds of approximately $433.2 million net of the underwriting discount.
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The increase was attributed to the amortization of intangibles acquired as part of the business combination with Foresight Diagnostics. ​ Interest Expense ​ Interest expense decreased by $6.6 million, 61.9%, in the year ended December 31, 2025 compared to the same period in the prior year due to the redemption of the Convertible Notes in October 2024. ​ 79 Table of Contents Interest and Other Income ​ Interest and other income increased by $2.6 million, or 6.1%, in the year ended December 31, 2025, compared to the same period in the prior year, primarily due to unrealized gains on warrant valuations. ​ Income Tax Benefit (Expense) ​ Income tax benefit (expense) increased by $60.6 million, or 8,722.9%, in the year ended December 31, 2025, compared to the same period in the prior year, primarily due to a tax benefit from a partial release of the valuation allowance in connection with the acquisition of Foresight Diagnostics.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThis risk is mitigated as we have maintained a relatively short average maturity for our investment portfolio. An incremental change in the investment yield of 100 basis points would increase our annual interest income by approximately $0.2 million annually in relation to amounts we would expect to earn, based on our short-term investments as of December 31, 2024.
Biggest changeThis risk is mitigated as we have maintained a relatively short average maturity for our investment portfolio. We do not hold any short-term investments as of December 31, 2025. Foreign Currency Exchange Rate Fluctuations ​ Our operations are currently conducted primarily in the United States.
An incremental change in the borrowing rate of 100 basis points would increase our annual interest expense by $0.8 million based on our $80.4 million gross debt outstanding on our Credit Line, including principal and accrued interest as of December 31, 2024. Our investment portfolio is exposed to market risk from changes in interest rates.
An incremental change in the borrowing rate of 100 basis points would increase our annual interest expense by $0.8 million based on our $80.3 million gross debt outstanding on our Credit Line, including principal and accrued interest as of December 31, 2025. Our investment portfolio is exposed to market risk from changes in interest rates.
The Company’s inability or failure to fully offset any such higher costs could harm the Company’s business, financial condition, and results of operations. ​ ​ 79 Table of Contents
The Company’s inability or failure to fully offset any such higher costs could harm the Company’s business, financial condition, and results of operations. ​ ​ 84 Table of Contents
ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RIS K ​ Interest Rate Risk ​ We are exposed to market risks in the ordinary course of our business. These risks primarily relate to interest rates. Our Credit Line had an interest rate of 30-day LIBOR plus 1.10%.
ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RIS K ​ Interest Rate Risk ​ We are exposed to market risks in the ordinary course of our business. These risks primarily relate to interest rates. Our Credit Line had an interest rate set at the 30-day Secured Overnight Financing Rate, or SOFR, average, plus 1.21%. The SOFR rate is variable.
The interest rate was subsequently changed to the 30-day Secured Overnight Financing Rate, or SOFR, average, plus 1.21%. The SOFR rate is variable. In October 2023, the interest rate for the Credit Line was subsequently changed to the 30-day SOFR average, plus 0.5%.
In October 2023, the interest rate for the Credit Line was subsequently changed to the 30-day SOFR average, plus 0.5%.
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For the fiscal year ending December 31, 2024, compared to the fiscal year ending December 31, 2023, our unrealized loss on available for sale securities decreased due to the change in average yield rate, resulting in an unrealized gain of $2.4 million for the year ended December 31, 2024. ​ Foreign Currency Exchange Rate Fluctuations ​ Our operations are currently conducted primarily in the United States.

Other NTRA 10-K year-over-year comparisons