Earnings release
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NEW HAVEN, CT, (August 13th, 2025) – Specialty cancer diagnostics company Precipio, Inc. (NASDAQ: PRPO), filedits 10-Q report today. The following are the highlights of the Company’s financial performance and outlook for 2025. “Yet another quarter of revenue growth in both company divisions, along with overall gross margin improvement, has ledto an improved cash performance for the Company. With the remaining repayment of the Change Healthcare loan to becompleted by the end of the year, and continued strength in both revenue and margin growth, management believes thatthe Company is on track to end the year as a cash flow positive business, and with a debt-free, strong balance sheet”,said Ilan Danieli, Precipio’s CEO. Q2-2025 Financial Results: Q2-2025 revenues reached $5.7M, representing a 27% increase YoY from $4.4M in Q2-2024, and a QoQ increase of15% from Q1-2025. Pathology services revenue increased 18% from the prior quarter. Revenues from Productcustomers increased 23% from the prior quarter (this comparison excludes fees of $145K in Q1-2025 from a specialproject with a pharmaceutical company). Adjusted EBITDA. Q2-2025 Adjusted EBITDA was ($78K) vs ($609K) YoY, a significant improvement of 87% resultingfrom both revenue growth and cost management initiatives. Cash flow. Cash used by operations (net of Change Healthcare transactions and the Covid-related EmployeeRetention Credit) decreased from $516K in Q2-2024, to $148K in Q2-2025, an improvement of 71% YoY. Products Division Summary: We are seeing clear momentum in our products division, driven by continued progress with our distributor network and agrowing pipeline of customers at various stages of the sales and onboarding process. Product revenues demonstrated astrong rebound this quarter, fueled by the return of two customers to full operational volume and the onboarding of a newcustomer. Additional revenue growth came organically from existing customers who expanded their test offerings by adding newHemeScreen panels, reinforcing both the value of our platform and the scalability of our product portfolio. Pathology Services Division Summary: Pathology Services revenue increased by approximately $0.75M, or 17% from $4.25M in Q1-2025 to $5.0M in Q2-2025.This growth was achieved through organic growth and the efforts of our existing sales team, via both the acquisition ofseveral new customers, and increased volume coming from existing customers. We do not anticipate any substantialcapital expenditures required to continue to support this growth, nor any significant additions to the laboratory staff. Withlaboratory operations well below capacity, this continued growth represents direct contribution to increased margins andcash generated by the operation. Gross margins, operating expenses: Gross margin analysis: Product’s division gross margins YoY were 44% in Q2-2025 and 50% in Q2-2024. This decline of 6% is due to anumber of factors: First, a recent increase in rent expense following the Company’s expansion into a larger space tosupport future growth. Management views this as a strategic investment in scaling operations and expects margins toimprove as revenue continues to grow and fixed costs are absorbed more efficiently. Second, an increase indepreciation expense due to the purchase of manufacturing-related equipment. These capital expenditures are alignedwith our long-term strategy to enhance production capacity, improve operational efficiency, and support the anticipatedgrowth of our Products division. Moreover, Product economics are highly scalable; for example, an increase of lessthan $100,000 in product revenue will increase gross margins by over 6%, returning to prior quarter margin level. Pathology Services division gross margins have increased YoY from 37% to 43%, The margin increase is due toincreased case volume this quarter, as well as improved case mix towards more profitable tests run in our lab Overall, the Company’s gross margin has increased YoY from 39% to 43%. EBITDA and Adjusted EBITDA Reconciliation and Explanation EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is a non-GAAP financial measure that is widelyused to evaluate operational performance. Management believes Adjusted EBITDA provides investors with a usefulperspective on the company’s ongoing financial health, by also eliminating (a) unusual non-operating income andexpense and (b) non-cash charges for employee stock option costs. Below is a reconciliation of Net Income, EBITDA and Adjusted EBITDA for the second quarter of 2025 and 2024: ($ in millions, Unaudited) Q2-2025 Q2-2024 2025-08-15 09:31 Precipio Announces its Q2-2025 Financial Results - Precipio https://www.precipiodx.com/precipio-announces-its-q2-2025-financial-results/ 1/3
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Net income/(loss) (GAAP) $0.1 $(1.2) Adjustments to net income/(loss): Interest expense, net $0 $0 Income taxes $0 $0 Depreciation $0.1 $0.1 Amortization of intangibles $0.2 $0.2 EBITDA (non-GAAP) $0.4 $(0.9) Further Adjustments to EBITDA: Stock-based compensation expense $0.4 $0.3 Other non-operating (income) expenses, net $(0.9) $0 Adjusted EBITDA (non-GAAP) $(0.1) $(0.6) Note: The full unaudited condensed consolidated financial statements, including the balance sheet and statement of cashflows as of and for the three and six months ended June 30, 2025 and 2024, are included in the Company’s QuarterlyReport on Form 10-Q filed with the Securities and Exchange Commission on or before August 14, 2025, which isavailable on the SEC’s website at www.sec.gov and on the Company’s investor relations website. Shareholder Conference Call: At 5:00 pm ET on August 14, 2025, the Company will host its quarterly shareholder call where management will providemore details as to the Company’s quarterly performance and outlook going forward. Please join us by dialing in at800.717.1738. About Precipio Precipio is a healthcare biotechnology company focused on cancer diagnostics. Our mission is to address the pervasiveproblem of cancer misdiagnoses by developing solutions in the form of diagnostic products and services. Our productsand services deliver higher accuracy, improved laboratory workflow, and ultimately better patient outcomes, which reducehealthcare expenses. Precipio develops innovative technologies in our laboratory where we design, test, validate, anduse these products clinically, improving diagnostic outcomes. Precipio then commercializes these technologies asproprietary products that serve the global laboratory community and further scales Precipio’s reach to eradicatemisdiagnosis. Availability of Other Information About Precipio For more information, please visit the Precipio website at https://www.precipiodx.com/ or follow Precipio on X (formerlyTwitter) (@PrecipioDx) and LinkedIn (Precipio) and on Facebook. Investors and others should note that we communicatewith our investors and the public using our company website (https://www.precipiodx.com), including, but not limited to,company disclosures, investor presentations and FAQs, Securities and Exchange Commission filings, press releases,public conference call transcripts and webcast transcripts, as well as on X and LinkedIn. The information that we post onour website or on X or LinkedIn could be deemed to be material information. As a result, we encourage investors, themedia and others interested to review the information that we post there on a regular basis. The contents of our websiteor social media shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended. Forward-Looking Statements This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933,as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in thispress release that do not relate to matters of historical fact should be considered forward-looking statements, including,without limitation, statements regarding the targets set herein and related timing. Except for historical information,statements about future volumes, sales, growth, costs, cost savings, margins, earnings, earnings per share, dilutedearnings per share, cash flows, adjusted EBITDA, plans, objectives, expectations, growth or profitability and our potentialto reach financial independence are forward-looking statements based on management’s estimates, beliefs, assumptionsand projections. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,”“plans,” “believes,” “seeks,” “estimates,” “predicts,” and variations on such words, and similar expressions that reflect ourcurrent views with respect to future events and operational, economic and financial performance, are intended to identifysuch forward-looking statements. These forward-looking statements are only predictions based on management’s currentexpectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertaintiesand other important factors that may cause our actual results, performance or achievements to be materially different 2025-08-15 09:31 Precipio Announces its Q2-2025 Financial Results - Precipio https://www.precipiodx.com/precipio-announces-its-q2-2025-financial-results/ 2/3
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from any future results, performance or achievements expressed or implied by the forward-looking statements, including,but not limited to, the important factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K forthe fiscal year ended December 31, 2024, and our other reports filed with the U.S. Securities and Exchange Commission.Any such forward-looking statements represent management’s estimates as of the date of this press release only. Whilewe may elect to update such forward-looking statements at some point in the future, except as required by law, wedisclaim any obligation to do so, even if subsequent events cause our views to change. These forward-looking statementsshould not be relied upon as representing our views as of any date subsequent to the date of this press release. 2025-08-15 09:31 Precipio Announces its Q2-2025 Financial Results - Precipio https://www.precipiodx.com/precipio-announces-its-q2-2025-financial-results/ 3/3