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DATE
Wednesday, Oct. 29, 2025 at 4:30 p.m. ET
CALL PARTICIPANTS
Co-Chief Executive Officer — Helmy Eltoukhy
Co-Chief Executive Officer — AmirAli Talasaz
Chief Financial Officer — Michael Bell
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TAKEAWAYS
Total Revenue -- $265.2 million total revenue for Q3 2025, up 39% year over year, with broad-based growth across oncology, biopharma and data, and screening.
Oncology Revenue -- $184.4 million for Q3 2025, representing 31% year-over-year growth, primarily driven by accelerated test volume growth.
Oncology Test Volume -- Approximately 74,000 tests were reported in Q3 2025, a 40% year-over-year increase.
Guardant360 Liquid Volume Growth -- Volumes up more than 30% year over year, marking the fifth consecutive quarter of accelerating growth for Guardant360 Liquid.
Guardant360 Tissue Volume Growth -- Achieved strong year-over-year acceleration following Q2 product upgrades.
Reveal Test -- Identified as Guardant Health (GH +3.87%)'s fastest-growing oncology product, benefiting from CRC surveillance reimbursement and strength in breast and lung cancer indications.
Biopharma and Data Revenue -- $54.7 million for Q3 2025, up 18% year over year, with milestone revenue from two companion diagnostic (CDx) approvals.
Shield Screening Revenue -- $24.1 million on 24,000 tests in Q3 2025, with ASP at approximately $880, and volume up sequentially by 8,000 tests compared to the prior quarter.
Shield Annualized Run Rate -- Screening revenue tracking at a $100 million annualized run rate roughly one year into the commercial launch of the FDA-approved Shield.
Shield Gross Margin (Non-GAAP) -- Improved to 55% non-GAAP gross margin, with cost per test below $500 and ASP stable.
Overall Non-GAAP Gross Margin -- Increased to 66% non-GAAP gross margin, up from 63% in the prior year period.
Non-GAAP Operating Expenses -- $228.8 million, up 22%, primarily due to investment in expanding commercial infrastructure and scaling sales and marketing for Shield.
Adjusted EBITDA Loss -- Adjusted EBITDA loss was $45.5 million, improving by $10.7 million versus the prior year. Free cash flow burn was $45.8 million, improved by $9.5 million compared to the prior year period.
Cash Position -- Ended the quarter with approximately $690 million in cash, cash equivalents, and restricted cash.
Raised 2025 Full-Year Guidance -- Revenue guidance increased to $965 million–$970 million (about 31% growth) for full-year 2025; oncology revenue growth guided to 25% (prior 20%), and Shield revenue guidance raised to $71 million–$73 million (prior $55 million–$60 million).
Oncology Test Volume Outlook -- Oncology test volume for 2025 is now forecast to grow more than 30% (previously more than 27%).
Non-GAAP Gross Margin Guidance Raised -- Updated to 64%-65% (prior 63%-64%).
2025 Free Cash Flow Burn -- Guidance is $225 million–$235 million free cash flow burn for 2025 (improving on $275 million in 2024), with the company targeting company-wide cash flow breakeven by 2027.
FDA and Regulatory Developments -- PMA submission completed for Guardant360 Liquid; Guardant360 CDx received FDA approval as a companion diagnostic to Inlureo for ESR1 mutated advanced breast cancer and regulatory approval in Japan for Enhertu in HER2 mutated non-small cell lung cancer.
Strategic Partnerships -- Announced collaborations with Quest Diagnostics (NYSE: DGX) (to enable physician orders and EMR integration nationwide, planned for 2026) and PATH Group (expanding Shield access to 250+ health systems in 25 states).
Clinical Data and Technology -- Shield Multi-Cancer now available nationwide, with real-world specificity of 99% and positive predictive value of 41% in a 9,251-person study; over 1 million cumulative clinical patient samples now tested, and 350,000+ samples with epigenetic profiles.
Sales Force Expansion -- Shield now supported by over 250 field salespeople; oncology sales infrastructure described as larger and fully built out.
Medicare Reimbursement -- Shield ASP benefitted from strong Medicare and Medicare Advantage payments at $1,495; Reveal CRC volume reimbursement at $1,640 for Medicare, with improving pull-through on Medicare Advantage and commercial payers.
SUMMARY
Management reported that Shield's screening revenue is tracking at a $100 million annualized run rate about one year into the commercial launch of the FDA-approved product, driven by high patient and physician adoption. Guardant Health achieved a significant milestone with core business segments becoming cash flow positive one quarter earlier than targeted, excluding the screening business. The company emphasized new sales channels and commercial partnerships, especially with Quest Diagnostics and PATH Group, as key vehicles for expanding Shield's reach nationwide in 2026. Executives noted over 1 million cumulative clinical patients tested, accelerating the company's clinical data generation and proprietary capabilities. The filing for FDA PMA approval for Guardant360 Liquid and new companion diagnostic approvals in the U.S. and Japan signaled regulatory momentum.
Michael Bell stated, "We are very pleased with the year-over-year improvement in non-GAAP gross margin, which increased to 66% compared to 63% in the prior year period."
AmirAli Talasaz reported more than 90% sample completion rates for Shield when ordered, demonstrating routine blood-test integration into primary care practices.
Shield Multi-Cancer’s specificity and positive predictive value reflected real-world data from a study of 9,251 individuals in a recent clinical collection initiative.
Sales and marketing expense growth was attributed specifically to accelerated Shield commercialization and infrastructure investment.
Leadership confirmed that any incremental gross profit from screening is being reinvested to maximize Shield’s first-mover advantage in colorectal screening.
Executives highlighted ongoing data submissions for Reveal’s immuno-oncology and chemotherapy monitoring as next steps toward expanded reimbursement coverage.
Medicare Advantage reimbursement for Shield tests exceeded expectations, supporting steady ASP and improved non-GAAP margin outlook.
Regulatory strategy includes seeking ADLP designation for Guardant360 Liquid, with management viewing FDA approval as foundational for future portfolio simplification and market expansion.
INDUSTRY GLOSSARY
CGP (Comprehensive Genomic Profiling): A molecular testing approach utilizing next-generation sequencing to analyze hundreds of cancer-related genes in a single test, supporting therapy selection and disease monitoring in oncology.
MRD (Minimal Residual Disease): A diagnostic term referring to small numbers of cancer cells that may remain in the body during or after treatment, detectable via sensitive assays, and a focus for recurrence monitoring and therapy decisions.
PMA (Premarket Approval): The FDA’s regulatory process for evaluating the safety and effectiveness of Class III medical devices before they are marketed, requiring submission of extensive clinical data.
ADLT (Advanced Diagnostic Laboratory Test): A Medicare payment category for advanced molecular diagnostics that offers a specific three-year reimbursement rate for newly launched tests meeting distinct criteria.
CDx (Companion Diagnostic): An in vitro diagnostic test providing information essential for the safe and effective use of a corresponding drug or biological product, required for certain targeted therapies.
ASP (Average Selling Price): The average amount earned per unit sold of a particular test or product; a critical metric for evaluating reimbursement and pricing strategy.
Full Conference Call Transcript
Helmy Eltoukhy: Good afternoon and thank you for joining our third quarter 2025 earnings call. Starting on Slide three, Q3 was an exceptional quarter for Guardant Health, Inc. with broad-based growth across our business. Anthology volumes grew 40% as year-over-year volume growth continued to accelerate driven by Guardant360 Liquid, Guardant360 Tissue, and Reveal. Our biopharma business grew nicely year over year with positive CDx momentum and screening volume accelerated with a sequential increase of 8,000 SHIELD tests. Importantly, screening has started to generate meaningful revenue tracking at an annual run rate of approximately $100 million roughly one year into the commercial launch of the FDA-approved product.
Overall, we are very pleased with our performance this quarter delivering 39% year-over-year revenue growth and crossing over $1 billion in annualized revenue for the first time. Excluding screening, we reached a major milestone with the rest of the business becoming cash flow positive one quarter earlier than expected. Indeed, this quarter sets us up very well to deliver on the long-term plan that we laid out at our Investor Day last month. Lastly, we recently surpassed 1 million cumulative clinical patients tested by Guardant Health, Inc. and as such we want to highlight one of these patients with a story that captures the profound impact our tests are having in everyday clinical practice.
A 67-year-old man had gone unscreened for colorectal cancer for several years despite his physician recommending colonoscopy or stool-based tests annually beginning in 2021. Each time the patient declined to be screened. In December 2024, the physician ordered a SHIELD blood test and the patient agreed to complete the blood draw during the same visit. The result came back positive. When his physician explained that a positive SHIELD result required a follow-up colonoscopy, the patient agreed to have the procedure despite previously resisting. The colonoscopy was performed in January 2025 revealing colorectal cancer. The patient quickly began treatment, and at his most recent follow-up, he had successfully completed therapy and was doing well.
This is a powerful example of how the SHIELD blood test can remove barriers to screening, provide a more pleasant and convenient option for patients, and ultimately improve outcomes.
Michael Bell: Now turning to top-line performance on Slide four. Q3 revenue grew 39% year over year to $265 million with strong performance again across our oncology screening and biopharma and data businesses. Taking a closer look at our oncology business on Slide five. Oncology revenue increased 31% to $184 million and oncology volumes increased 40% year over year to approximately 74,000 tests in the third quarter. Turning to Slide six. We have seen a clear acceleration in volume since July, following the introduction of Guardant360 Liquid on our smart platform.
Since then, we have launched two additional waves of applications, driving five consecutive quarters of accelerating volume growth and we look forward to future waves of smart app introductions to both through the power of Infinity AI to help fuel future growth. In addition to Guardant360 Liquid, Guardant360 Tissue and REVEAL volumes also experienced strong year-over-year growth. Moving on to Slide seven. As a reminder, our 1 million patient samples include more than 350,000 epigenetic profiles across more than 100 tumor types to bring powerful insights and new products to market faster than ever.
Infinity AI enables higher resolution mapping of tumor biology giving rise to not only entirely new products in the clinical business, but novel signatures for faster drug discovery relevant to our biopharma business and new commercial insights and decision support tools. Turning to Slide eight. To date, we have launched 15 groundbreaking smart apps on Guardant360 Liquid with dozens more in development that will roll out across Guardant360 Liquid, Tissue, and Reveal. Each new application builds towards what we see as a GPS for cancer care. Guiding physicians with the right insights at every step of the patient journey.
We believe these applications not only significantly expand the clinical utility of Guardant360 Liquid but further extend our technical leadership in the liquid CGP market. Looking more closely at some of the recent highlights within our oncology business on Slide nine. Guardant360 volume grew exceptionally with more than 30% year-over-year growth. Guardant360 Tissue also had a great quarter showing strong year-over-year acceleration following the major product upgrades released in the second quarter. Once again, Reveal contributed very nicely and continues to be our fastest-growing oncology product. In addition to the strong performance, we recently reached a major milestone with the submission of our PMA application to the FDA for Guardant360 Liquid.
This submission has the potential to streamline Guardant360 Liquid with a single flagship FDA-approved liquid biopsy for therapy selection, simplifying our portfolio, accelerating adoption, and further strengthening our leadership in this space. In addition, FDA approval would lay the foundation for ADLP designation which is an important mechanism for capturing the appropriate value for our expanded test offering in the future. We had a strong presence at ESMO 2025, with 15 abstracts spanning the cancer care continuum, from MRD detection and recurrence monitoring with studies such as PEGASUS to advanced stage tumor profiling and therapy response assessment. For REVEAL, we are making great progress with data generation and publications.
We recently submitted our immuno-oncology therapy monitoring data package to MolDx to support Medicare reimbursement and submitted data from our chemotherapy monitoring study for publication. Turning to Slide 10 to take a closer look at our REVEAL data pipeline. Over the last few months, we have made significant progress in MRD, generating and publishing compelling data across multiple cancer types. Earlier this year, we achieved Medicare coverage for CRC surveillance and have since submitted dossiers for breast surveillance as I just mentioned for immuno-oncology therapy monitoring. We plan to submit packages for chemotherapy and CDK4/6 inhibitor monitoring following those publications. Looking ahead, we have ongoing studies across more than five additional tumor types in both the adjuvant and surveillance settings.
Together, this growing body of evidence will continue to strengthen the clinical utility and analytical validity of Reveal, supporting broader adoption in MRD. Turning now to Slide 11. I am proud of the progress we have made over the last few years in both driving demand and revenue growth across our portfolio. Looking ahead, we see multiple drivers across our oncology business that position us well for durable long-term growth. We will continue investing in commercial initiatives that make it easier for physicians to access our tests through portal enhancements, EMR integrations, and enhanced workflows.
In our therapy selection business, transitioning to the smart platform unlocks wave after wave of novel applications, many unique to Guardant Health, Inc. that will help us differentiate and continue gaining market share. And in MRD, redoubled commercial focus on REVEAL supported by significantly lower COGS and Medicare coverage for CRC surveillance positions us for strong growth ahead. We are also excited to introduce an ultra-sensitive tissue-informed MRD assay that will complement our best-in-class tissue-free REVEAL test. Looking more closely at some of the recent highlights within our biopharma and data business in Slide 12. We delivered another strong quarter with third-quarter revenue growing 18% year over year.
We continue to deepen our relationships with large pharma and had two additional companion diagnostic approvals in Q3. In late September, Guardant360 CDx received FDA approval as a companion diagnostic to Inlureo for the treatment of ESR1 mutated advanced breast cancer. This marks the second FDA-approved indication in breast and the sixth overall CDx claim approved by the FDA for Guardant360 CDx. We also received regulatory approval in Japan for Guardant360 CDx as a companion diagnostic to Enhertu for non-small cell lung cancer patients with HER2 mutations. We now have 23 total CDx approvals across biomarker and tumor types. Our robust and growing pipeline of partnerships ensures that near-term revenue visibility remains high.
With that, I will now turn the call over to AmirAli for an update on screening.
AmirAli Talasaz: Thanks, Helmy. Moving on to Slide 13. We delivered $24 million of Shield testing revenue in Q3, driven by approximately 24,000 tests. It has been incredibly rewarding to see Shield volume take off and hear story after story of patients positively impacted by this pioneering test, such as the story Helmy highlighted at the beginning of our call. Now turning to Slide 14 to take a closer look at screening highlights for 2025. Starting with CRC screening, given the strong performance and growing demand, we have accelerated the building out of our commercial infrastructure beyond our original plan.
In addition, the breakthrough nature of the Shield brand has provided us with strategic partnership opportunities, including our recently announced collaborations with Quest Diagnostics and PATH Group. Shield continues to generate strong demand from both patients and physicians with high adherence rates. As exemplified by the patient story we shared earlier, we are seeing Shield tests get completed with blood samples received for more than 90% of ordered cases. This demonstrates the simplicity of Shield as a routine blood test for CRC screening that can be implemented into routine PCP practice. We are encouraged by the performance of our Shield CRC V2, which demonstrated solid clinical performance with improved sensitivity for stage one colorectal cancer. Turning to our multi-cancer initiatives.
We are very excited to announce that Shield Multi-Cancer is now available nationwide through our clinical data collection initiative. At our Investor Day last month, we shared strong real-world performance data for Shield MCD from a study of 9,251 individuals. Specificity was 99% consistent with earlier NCI findings and positive predictive value was 41%, meaning that when Shield is positive, there is a 41% likelihood of cancer being present. Lastly, we are proud to partner with the American Cancer Society and look forward to everyone having access to convenient and timely cancer screening so we can detect cancer earlier and provide opportunities for better outcomes.
Taking a closer look at our recent strategic partnerships to scale our commercial infrastructure on Slide 15. First, we were very excited to announce a strategic collaboration with Quest to expand and accelerate Shield Access more broadly in the U.S. Quest's provider clients will be able to order Shield Tests and receive the results directly through the Quest connectivity system. We believe this strategic collaboration is valuable in two ways. First, it enables a better ordering experience and brings forward our nationwide EMR strategy by several years. This will give us immediate connectivity to 650,000 clinician and hospital accounts in the Quest system. We believe this accelerated connectivity will drive our scale.
We will also have access to deep logistical infrastructure, including 2,000 patient service centers, and 6,000 in-office phlebotomists in the United States. Second, Quest's promotional activities using their nationwide field force in combination with our own multi-100 person sales force will further strengthen our competitive position in the primary care market. Quest's national commercial sales team will proactively educate primary care physicians and OBGYNs about the SHIELD test, accelerating awareness and adoption among their ordering providers. We expect Shield to be available for physician order through Quest in 2026. We will continue to process all Shield tests and control client services and billing and reimbursement operations.
In addition, we recently announced our partnership with PATH Group, which expands Shield's reach to more than 250 health systems across 25 states representing another exciting accelerator for physician and patient access. We are looking forward to seeing the positive impact of our growing commercial infrastructure in 2026 and years to come. We also remain confident in the potential inclusion of Shield in the American Cancer Society guidelines in the near future which should be a catalyst for broader patient access. Moving on to Slide 16. Our goal has always been to detect many cancer types early when they are most treatable. With that in mind, we developed Shield as a multi-cancer detection platform. Turning to Slide 17.
And as I mentioned earlier, we have now broadened access to Shield multi-cancer detection. In order for a patient to access this result report, their physician will need to opt in to receive the multi-cancer report, and the patient will need to authorize the release of medical records to Guardant Health, Inc. We successfully piloted this workflow in several accounts and following overwhelming positive feedback from physicians and strong participation by patients, we expanded this offering nationwide. Moving on to Slide 18.
The launch of this initiative establishes a scalable platform for clinical data generation, enables assessment of the utilization of MCD results in patient care, and provides a new avenue to expand patient access to multi-cancer detection, bringing this important innovation to a broader population. This nationwide initiative is expected to reach hundreds of thousands of participants making it one of the largest prospective evidence generation initiatives for early cancer detection. Turning now to Slide 19. With the expansion of Shield to include MCD results together with authorization to release medical data, we are now well-positioned to further strengthen our data moat.
This high-quality data serves as a regulatory-grade source of truth, providing details on each patient's cancer journey that were previously not accessible. We will generate large-scale prospective evidence about the performance, clinical value, and safety profile. We believe this high-resolution data will power continuous improvement of Shield MCD, and also lay the foundation to potentially expand into multi-disease detection. With that, I will now turn the call over to Mike for more detail on our financials.
Michael Bell: Thanks, AmirAli. Turning to Slide 20. I will now review select financial highlights for the quarter ended September 30, 2025. Unless otherwise noted, all growth rates are year over year. Total revenue for the third quarter grew 39% to $265.2 million driven by strong performance across all three major revenue lines: Oncology, biopharma and data, and screening. Oncology revenue increased 31% to $184.4 million primarily driven by another quarter of accelerated test volume growth. We reported approximately 74,000 oncology tests in the third quarter, representing 40% growth reflecting continued positive momentum across the portfolio.
Guardant360 Liquid delivered its fifth consecutive quarter of accelerating growth, with volumes up more than 30%, supported by the expanding clinical utility enabled by smart launched over the past year. Guardant360 Tissue also had an exceptional quarter, showing strong year-over-year acceleration following the major product upgrade released in the second quarter. Reveal remains our fastest-growing oncology product, benefiting from CRC surveillance reimbursement achieved earlier this year and continued strength across both breast and lung cancer indications. As a reminder, we do not include Guardant hereditary cancer testing or IHC volumes in our reported totals. We continue to expect minimal revenue contribution from these new offerings through 2025. Average selling prices remained stable compared to the prior quarter.
Guardant360 Liquid was in the range of $3,000 to $3,100, Guardant360 Tissue was approximately $2,000, and Reveal was in the range of $600 to $700. We also recognized approximately $5 million of out-of-period oncology revenue in the third quarter compared to $12 million in the prior year period. Our biopharma and data business continued to perform well, with revenue increasing 18% to $54.7 million, including milestone revenue from two companion diagnostic approvals achieved during the quarter. The biopharma pipeline remains solid, providing confidence in both the near-term and long-term growth prospects. Screening revenue from Shield totaled $24.1 million generated from 24,000 tests reported during the quarter. Shield ASP was approximately $880 above expectations, reflecting our continued focus on Medicare-covered patients.
We also recognized approximately $3 million of out-of-period screening revenue, driven by better-than-expected reimbursement from Medicare Advantage payers for tests performed in 2025. This positive trend reinforces our confidence in both near-term and long-term expectations for Medicare Advantage reimbursement rates and overall Shield ASP targets. Turning to Slide 21. We are very pleased with the year-over-year improvement in non-GAAP gross margin, which increased to 66% in Q3 2025 compared to 63% in the prior year period. This improvement was primarily driven by a significant reduction in REVEAL COGS, which have declined from over $1,000 per test in Q3 2024 to less than $500 per test, as well as strong progress in Shield gross margin.
Shield's non-GAAP gross margin improved from negative levels at the launch just over a year ago to 55% in 2025. This improvement reflects strong ASPs under the Medicare ADLT rate of $1,495, disciplined focus on reimbursable tests, and continued COGS reduction. Shield's non-GAAP cost per test again trended lower sequentially and continues to be below $500 per test, consistent with our operational plan. These gains reflect the ongoing benefits of increased Shield volume and disciplined cost management. Turning to Slide 22. Non-GAAP operating expenses were $228.8 million in the third quarter, an increase of 22% in line with expectations. The increase was primarily driven by continued investments to expand our screening commercial infrastructure and scale sales and marketing for Shield.
As we conclude 2025 and enter 2026, we will maintain focus on these investments to maximize our first-mover advantage in blood-based colorectal cancer screening. Adjusted EBITDA loss was $45.5 million, an improvement of $10.7 million compared to a loss of $56.2 million in 2024. We remain disciplined in our approach to cash management. Free cash flow burn was $45.8 million, improving by $9.5 million compared to the prior year period. Importantly, excluding the screening business, Guardant Health, Inc. generated positive free cash flow during the quarter, a significant milestone achieved one quarter ahead of our stated target.
We expect the core business to remain free cash flow positive in the fourth quarter as well as for the full year 2026 and beyond. We ended the quarter with approximately $690 million in cash, cash equivalents, and restricted cash. Turning to the full-year 2025 outlook on Slide 23. Based on our strong year-to-date performance, we are raising full-year 2025 revenue guidance for the third time this year to a range of $965 million to $970 million, representing approximately 31% growth compared to 2024. At the midpoint, this represents an increase of $47.5 million versus our prior range.
We now expect oncology revenue to grow approximately 25% year over year, up from prior guidance of 20%, driven by stronger-than-expected oncology volumes in the third quarter and higher expected volumes for the remainder of the year. We now forecast total oncology test volume to grow more than 30% compared to our previous expectation of greater than 27%. Our biopharma and data business remains on track to deliver mid-teens growth for the full year. We are also increasing our Shield revenue guidance to $71 million to $73 million, up from $55 million to $60 million, reflecting higher expected volume of 80,000 to 82,000 tests compared to prior guidance of 68,000 to 73,000 tests.
With continued improvement in gross margins, we are raising our full-year non-GAAP gross margin guidance to 64% to 65%, up from 63% to 64%. As previously outlined, we plan to reinvest incremental screening gross profit to accelerate commercial expansion. Accordingly, we now expect 2025 non-GAAP operating expenses to be in the range of $865 million to $875 million, representing a 14% to 16% increase compared to 2024. Finally, with our long-term financial roadmap, we remain committed to reducing cash burn each year and achieving company-wide cash flow breakeven by 2027. For the full year 2025, we continue to expect free cash flow burn of $225 million to $235 million, an improvement from $275 million in 2024. Turning to Slide 24.
We began 2025 with an ambitious set of strategic and operational objectives. Through our strong execution, we have delivered on nearly all of them, and we expect continued momentum as we close out the year. Our progress this quarter positions Guardant Health, Inc. for sustained success in 2026 with continued oncology volume growth and strong Shield adoption. With that, we will now open the call for questions.
Operator: Thank you. We will now begin the Q&A session. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking your question. Again, during this Q&A session, we ask that you limit yourselves to one question. We will pause here briefly as questions are registered. The first question comes from the line of Bradley Bowers with Mizuho. You may proceed.
Bradley Bowers: Hey, there. Thanks for the question. A strong performance across the businesses, but I am going to focus on Shield here. Was wondering if you could walk us through kind of the Shield ASP dynamics exiting the year. Continued strong pricing, I think it is surprising given the ADLT pricing, but that $900 we are kind of exiting the year at. It is supposed to walk down to $700 by 2028. I know there are some mix implications there, but is it kind of a steady degradation? Is there a fallout expected as ADLT pricing kind of rolls off the initial phase at the end of this year? Any color on the phasing of that would be helpful. Thank you.
Michael Bell: Yes, Brad. This is Mike. I can take that. I mean, to break down the Shield ASP, you know, we have the Medicare rates at $1,495 that came into play at the start of the second quarter. We are also receiving really good payment from Medicare Advantage payers. And so when they are paying us, they are paying us at this $1,495 rate also. And at the moment, the majority of our volume is skewed towards Medicare and Medicare Advantage. And then we have a tranche of commercial patients, and we are effectively getting paid more or less zero for those.
And so as we look at over the next few years, we are very confident in the $1,495 ADLT rate going forward. And in fact, we have just submitted our package back to Medicare on the date of submission of the pricing over the last six months, and that should help us maintain this $1,495 rate now, at least for the next two years. Going forward, also, we expect Medicare Advantage to continue to be strong. In fact, we would hope that it can get stronger than where it is today.
The fluctuation over the next couple of years is going to be the percentage of commercial payer patients that we have and how quickly we can ramp up the commercial reimbursement there. And so we are assuming in 2028, there is just a higher proportion of commercial patients in the mix. It is going to take us time to sort of establish that reimbursement rate. But overall, we are really happy with where the ASP is today, and we think it bodes well for as we go into 2026 and beyond.
Operator: The next question is from the line of Doug Schenkel with Wolfe Research. You may proceed.
Doug Schenkel: Hey, good afternoon and thank you for taking my question. So another question on Shield. You mentioned at the Investor Day, and as well as in your prepared remarks that potential ACS guideline inclusion later this year could set the stage for commercial coverage in, I think, at least 10 states. And we believe Anthem and other large blues are watching closely. So to the best of our knowledge, ACS concluded their CRC screening guidelines review earlier this month. With that in mind, is guideline inclusion at this point a real possibility by year-end with ACS?
And then once guidelines are in place, how long do you think it is going to take for that to translate into you actually getting paid? Then the final component of the question is, beyond those initial 10 or so states, there are other states like Florida and Louisiana where mandates have been brought in to include ACS as well as NCCN in addition to USPS. So if we think about that broader universe of states, which I think maybe gets you closer to 17, is it likely that reimbursement could occur not just in the initial 10%, but closer to 20 over the next year or so? Thank you.
AmirAli Talasaz: Thank you, Doug, for your question. Yeah. You know, based on what we know, it appears that ACS research team is almost done with their work. So we remain confident about this potential for Shield to be included in the near future. We are monitoring the situation very closely, but we are very optimistic about that. In terms of the guide, like, you know, it is not part of this year guide. We are not counting on any kind of upside associated with the ACS guideline. And, you know, it is going to take some time.
When we go into the guideline, it gives us initially some upper hand, and it should have a strong it should have a positive impact on our appeal success rate. Initially. And then at some point, you know, that would result in product coverage and contracting successes. I am proud of what our team has achieved so far in trying to broaden access to Shield, you know, just Florida, now you know, through a consortium of, you know, supporters of making sure that innovative technology becomes accessible. Now, for instance, Medicaid patient population in Florida have access to tests like Shield, and we are very proud of that.
And in general, we are very pleased with some of the positive and regular dialogue that even we have with the admin about their priorities around cancer screening, around prevention, around making America healthy. And I am excited. That looks like both the president and secretary are looking for ways to see how maybe the rate of cancer can get reduced in the country and how could we try to bring innovations to patients in a faster way. But we will see what happens, but, obviously, we are not counting on any of those successes. In our drive at this time.
Operator: The next question comes from the line of Puneet Souda with Leerink Partners. You may proceed.
Puneet Souda: Yes. Thanks for taking my questions. Really impressive quarter here and really strong guide. If I may, AmirAli, first one on Shield. Just growth is accelerating on volumes, rightfully so, new product and ASP is also up. Should we think about 2026 growth for Shield and any early reception details that you can talk about on the MCD side? What is sort of the early attach rate? And for Helmy, it has been almost a decade since you launched G360 when it appeared on the market for the first time. It is really impressive to see ten years later, this product is growing 30% plus.
Maybe just talk to us about what is behind that and how should we think about growth going forward here for the Liquid G360, which has been impressive? Thank you.
AmirAli Talasaz: Maybe I will make the Shield part quick so I can talk to you about the oncology side. So as you have seen, we consistently raised our outlook throughout this year. We are very pleased with what we are seeing, the momentum that we are seeing. We want to be thoughtful and not get ahead of our skis. So, you know, I think still it is too early for us to comment about 2026. At the right time, we will talk about it, but we continue to be very confident about the long-term, you know, outlooks that we shared in our Investor Day.
Helmy Eltoukhy: Yeah. No. We are very pleased with the performance, and Sachiv, eleven years and counting in from when we launched in 2016. So to see it grow at this rate, you know, I think at this point in the product cycle, is really pleasing, but I think it is sort of what we expected in the sense that many people think of this as a test and they pattern match it to, you know, other tests in the market. But it truly is an application platform.
When you think about these smart apps that we are introducing and really the multiplication of clinical utility and ability and capabilities of this platform, this is just the beginning in terms of where liquid biopsy can go. I mean, that is the point of liquid biopsy is you can come in, you can test, you know, many more patients. You can increase access. But you can test them longitudinally as well. And you know, we are still at the very, very early innings in terms of where this can go with the technology can go. Just in oncology. So I think you are going to see a lot more I think, of this trajectory in the coming years.
As we continue to expand on the capabilities of Guardant360 over the next decade.
Operator: The next question comes from the line of Subhalaxmi T. Nambi with Guggenheim. You may proceed.
Subhalaxmi T. Nambi: Thank you for taking my question. If you were to put a timeline if we were to put a timeline to NCD FDA approval based on Shield trajectory next year, would FDA submission for MCD in late 2027 be a reasonable expectation?
AmirAli Talasaz: For MCD, you know, we just actually broadened access, and we just actually started getting access to this kind of clinical data that I talked about. During our Investor Day and the prepared remarks. So we need to monitor it and see how quickly we can build that evidence. But we are very optimistic that potentially through the way that we are doing, we can get access to hundreds of thousands of patients' data and monitor actually the impact of MCD testing in the clinical value, performance, safety. It is still too early for us to specifically put a timeline for FDA approval.
But we would monitor the situation closely and as we get more confidence, maybe we can talk about it at the right time. Perfect. Thank you, guys.
Operator: The next question comes from the line of Patrick Bernard Donnelly with Citi. You may proceed.
Patrick Bernard Donnelly: Thank you for taking the questions. Helmy, maybe one for you on Reveal. I know in the past, you have talked about driving the test per patient higher. Can you just talk about the traction there given the bigger push internally? What kind of progress you are seeing? Where can that go? Over the relative near term? And I know during the prepared remarks, you talked about obviously the ongoing studies, the additional tumor types, just talk about what we should be looking for and the key catalysts on the REVEAL side here the next couple of quarters to keep an eye on? Thank you.
Helmy Eltoukhy: Yes. Great question. I think we said at the beginning of the year, as we got the surveillance indication from a reimbursement point of view for Reveal that would be turning on a lot of the sort of capabilities to be able to pull in subsequent test orders and so on and you know, I am pleased to report that, you know, we have put a lot of those in place, and we are seeing some of the benefits of that and the return on investment there.
So we know we can pull in subsequent orders now in a sort of very straightforward way and so that is going to pay dividends across our blood-based portfolio as we think about the emergence and really, the place where longitudinal testing will sit in terms of management of patients in oncology with things like Serena six in terms of ESR1 with the upcoming launch for therapy monitoring, based on REVEAL. And then, obviously, with REVEAL itself in the MRD setting, recurrence monitoring. Setting. So yeah, really great progress. The number of tests per patient has gone up pretty nicely, and we are still, I would say, very much in the early cycles of really capitalizing on that investment.
Operator: The next question comes from the line of Tycho W. Peterson with Jefferies. You may proceed.
Tycho W. Peterson: Hey, thanks. I would love to hear your views on the Pegasus data and just kind of how you think about that. Having kind of any impact on just MRD-driven therapy management? And then how are you thinking about clinical utility evidence in general? And NCCN guidelines?
Helmy Eltoukhy: Yes. Pegasus was an interesting study. It was a phase two signal finding study, and you know, I think there are a few things that showed that I think were exciting to me, is the fact that you could spare something like 75% of patients from chemotherapy, which meant, you know, huge, huge reduction in terms of neurotoxicity and other toxicities related to such really harsh chemotherapy. And so I think you know, Pegasus is based on our previous version of REVEAL. And so I think we are really looking forward to track c, which is based on a newer version.
And really, the field, you know, having larger datasets to really understand exactly you know, where the threshold should be in terms of you know, escalation and de-escalation in terms of patients. But, you know, I think it is clear that I think there can be a lot of benefit by using, you know, this additional data in terms of ctDNA in the adjuvant and surveillance settings. But I think this is a good foundation and one that we can build on. As we continue investing in both clinical validity and clinical utility studies around our Reveal platform.
Operator: The next question comes from the line of William Bishop Bonello with Craig Hallum. You may proceed.
William Bishop Bonello: Hey guys. I just want to push a little deeper on Sunit's third question about the growth in Guardant360. Could you just give us some sense today? I mean, we think about what is out there that is driving, there is the underlying growth, there is the fact that you are probably taking share. But I am also curious about sort of where we stand today in terms of a paradigm shift to liquid first or perhaps to combination testing with liquid and solid tumor. And then to what extent we are seeing some of the repeat testing that you are talking about or the use of 360 for monitoring?
Just trying to get a sense of what inning we are at in terms of some of these new growth drivers and how much of that is still in front of us?
Helmy Eltoukhy: Yes. Great, great question. So we are still very early even in the penetration of liquid biopsy in terms of, you know, one test per lifetime. And so given, you know, the capabilities of 360 right now, they are just kind of mind-blowing to a lot of physicians just in terms of, you know, the depth, the sensitivity, the application space. We see that growth in just that initial setting. So that means not only market growth, but we are seeing from what we can see, significant share gains as well as a result. Then there are other growth drivers we are seeing. The fact that concurrent testing will likely become the standard of care of both tissue and liquid.
And so that is also another sort of growth driver and starting to see that really take off. And then finally, the test for patients. And so we estimate, at maturation that we should be able to go from one test per patient per lifetime to something like four and a half or four or five tests per patient per year which, you know, obviously means more than, you know, probably doubling of where the market is today. Sorry. More than a 10x in terms of where the market is today.
And so that is really exciting in terms of where things are going, and this is things like Serena's six in terms of ESR1, longitudinal monitoring, therapy monitoring, the data that we have with IO monitoring, with chemo monitoring, and so on. All of that will feed into essentially establishing, this new paradigm of, essentially monitoring patients with ctDNA. We are already seeing our biopharma partners use this type of testing in their phase one, phase two, phase three studies, using it to decide do they sort of scale phase one to phase two?
Using it for dosing, and so that is the other piece that I think is not very well appreciated is that a lot of tests you launch them they are used exactly the same way ten years later or fifteen years later and so on. They only have sort of one function. The application space and utility of how you use something like Guardant360 and Guardant Reveal is really multiplying quarter by quarter and year by year. And so, yeah, this is a true platform. That word is often overused. But this is a true platform.
And you are seeing what that means in terms of our volume growth and you know, the trajectory that we laid out at our Investor Day.
Operator: The next question comes from the line of Michael Ryskin with Bank of America. You may proceed.
Michael Ryskin: Hi, thank you for taking the question. This is Aaron on for Mike. I wanted to dive into Reveal volumes in specifically Reveal versus Ultra and how you guys are thinking about the R&D investment needed in both of those assets? And then the second part of that is MRD is still a fairly open space. 10% penetrated, what people are saying. So I guess, how are you guys looking at the market? How are you guys looking at growth? And how should we be expecting both of those assets to grow over the next three years? Thank you.
Helmy Eltoukhy: Yes. We are very excited about our MRD franchise. Reveal is, you know, the leading tissue-free MRD test in the market. We know that there will be essentially two parts of the market that will be important: the tissue-free side and the tumor-informed side of things. And, you know, we are very pleased in terms of where we sit in the tissue-free side. It is our fastest-growing product in oncology. And, you know, the amount of data, the amount of investments, you know, we have a 10x sort of data generation, planned as we presented before. Next year. And so, you know, that flywheel is really sort of chugging away. And so we are excited about that trajectory.
And then you know, in terms of the tumor-informed side, I think we agree with you. There is, you know, kind of a lot of opportunity there. In terms of a, you know, test that can really hit the needs of both biopharma and clinicians in terms of sensitivity better really acquired for that setting. And, yeah, we are just very pleased with the technology that we have developed. You know, think about it, just everything we have built as a company sort of is at a really nice point.
You know, the fact that we have really chugging away on our tissue volumes and the capabilities we have with using very low amounts of input material, very fast turnaround times. The sensitivity we have on the liquid biopsy side and the capabilities, bugs down and the speed to results, all of that is coming together in Reveal Ultra. And I think it is going to be a product that will, frankly, blow everyone away once we launch it. Very excited for that and making really good progress.
Operator: The next question comes from the line of Daniel Barkowitz with Evercore ISI. You may proceed. Daniel, your line may be muted. Our next question comes from the line of Mark Anthony Massaro with BTIG. You may proceed.
Mark Anthony Massaro: Hey guys, thanks for taking the questions. The first one is for you, AmirAli. Just looking at the Shield, it is great to see this trajectory. Is it reasonable to think in the near term that 1,000 sequential increase from the prior quarter is the right way to think about this just looking at the Q4 implied guide at the high end, it is plus 9%. You just did plus eight prior quarter, seven. Or so I guess I am asking if this is a reasonable run rate in the near term. Or do you think there is obviously upside from partnerships with Quest, PathGroup, you know, certainly guideline inclusion and potential DTC uplift? So that is my first part.
The second part is for Helmy. Helmy, can you just give us a sense for Reveal Ultra? I believe this is the tumor-informed that can go down to one part per million. Just give us a sense for maybe if you could clarify if that is commercially launched now and how we should think about the timing of CMS reimbursement and additional data readouts? Thanks.
AmirAli Talasaz: Thanks, Mark. So in terms of sequential growth, like our guide, what has ended in the midpoint is, like, another 8,000. Q over q growth in Q4. We are going to monitor the situation closely. And again, we do not want to get ahead of our skis and what is going to happen. Next year, we are going to talk about it at the right time. There are a bunch of catalysts, you know, still in front of us. You know, there is Quest, PathGroup, collaboration should be a positive thing. Guideline inclusion is definitely a positive thing. You know, continuous build-out of our own commercial team as we go into next year would be a positive thing.
So and we are confident about the target that we put out there for 2028. So but we go at it one step at a time. And we are very excited to see what is going to happen in Q4.
Helmy Eltoukhy: Yeah. In terms of Reveal Ultra, you know, I think the nice thing is we built such, you know, strong capabilities around MRD. When you think about the R&D and all the clinical studies, you know, tens of thousands of samples and many of those, we have actually retained tissue. So it is actually, you know, not, you know, very heavy investment for us to essentially leverage that to really come out with the sort of ultra technology, the tumor-informed technology we have. We are seeing really good data. Really excited in terms of where this can go.
In terms of the sensitivity, we think it can bring it down to a much lower level than exists in the field or, frankly, exists in the pipeline of companies we have seen out there. And I would say that you know, in terms of timing, we are keeping that close to the chest. So stay tuned. But, making good progress and we would not be talking about it if it was not something that, you know, was not in the too distant future.
Operator: The next question comes from the line of Kyle Alexander Mikson with Canaccord. You may proceed.
Kyle Alexander Mikson: Guys. Thanks for the questions. Congrats on the quarter. On REVEAL, is it possible you get ADLT status and breast Medicare coverage by the end of this year? Is that more likely a 2026 milestone? And then secondly, AmirAli, had a competitor this week announced advanced adenoma sensitivity data for its colon cancer blood tests. The confidence interval lower bound was fifteen percent and the study had a lot of very small lesions. Just curious if you think that a test with AA materially higher than thirteen percent for SHIELD would pose a threat and you would like, know, one day aim to improve upon your AA data.
AmirAli Talasaz: Yeah. I mean, I hear you feel status. You know, still a work in progress, obviously, with the government shutdown. Sort of paused some of the discussions a little bit. And then yeah, we are still working on breast and io. We have always said, you know, probably more likely early next year, and yeah, we are still, I think, on track for that. Regarding the data disclosures, you know, it is we obviously, we applaud anybody who is trying to contribute in this difficult area. This is a hard science area. And we feel very comfortable with our leadership position. And our technology stack, our data, and what we are doing.
We have seen similar results in this field now. A few times. Again, this is a hard field. It is a hard science field. And we believe we have the best tech stack, very innovative technology at home brew that gives us confidence. We have a three-year head start on CRC now. And know, probably even much longer on the multi-cancer side relative to some of these competitions. So we feel very good with our position at this time. And, definitely, there are some five activities that we are working on. We will see what happens.
Operator: The next question is from the line of Luke Sergott with Barclays. You may proceed.
Luke Sergott: Great. Thanks for the questions. Just wanted to touch here on the step up in OpEx that you guys have for the year and implied in 4Q? And really just kind of dig in where that spend, the incremental spend is going and where you guys think from an S&M perspective, where you guys want to exit the year as a number of reps as you think about Shield and Oncology and Reveal. And kind of how that you are able to pull forward any of those costs given the success you have had in some of these some of the other launches?
Michael Bell: Yes. I mean, for the OpEx step up, it is pretty much all in the sales and marketing line. I think we have been consistent throughout the year whereby we said we are going to be reinvesting any incremental gross profit in screening back into the sales and marketing line to really drive that commercial build-out. So and we will continue to do that. I think it is the biggest focus for us. As we look to scale. We have said on the screening side, we have now got over 250 salespeople out in the field. So that is a significant ramp-up. During the year, and we will continue to look at how we build that out.
On the oncology side, it is a little bit larger than that. And we have got a very sort of well-built-out commercial infrastructure with oncology. But, yes, as we look forward and going to 2026, I think you should expect to see a similar ramp in the sales and marketing line where very focused in the R&D line and G&A line and keeping them relatively flat. So I think that is the plan for the next twelve months.
Operator: The next question comes from the line of Daniel Gregory Brennan with TD Cowen. You may proceed.
Daniel Gregory Brennan: Great. Thank you. Congrats on the quarter. Maybe just on G360, just a couple. Maybe one for Mike and then one for Helmy. Just on the guide, I know that clinical oncology volume guide is now greater than 30. Does that contemplate like a big step down from the G360 line, which is accelerated tremendously year to date, obviously? The Q3 30%? And then B, more so for Helmy, I know you have given a lot of color on the excitement over the kind of outlook for G360. But could you give a little more color on the acceleration you have seen year to date? Is it more share gains which you talked about?
Like are you seeing like hospitals consolidate? Do you think it is more just penetration of CGP? Or do you think it is more like this test per patient pickup? Any way you can kind of dissect a little bit of this really strong acceleration? Thank you.
Michael Bell: Yes. Maybe I will just start on our four Q4 guide. So, you know, we had a great Q3. I think our guide for Guardant360 volume and for overall oncology volume, it implies sequential growth in Q4. It implies a very strong year-over-year growth in volume. So yes, if you back into it, it is over 30% year-over-year growth in Q4. So I think we have just continued to expect the momentum that we saw in Q3 to continue into Q4. So I think for us, things are looking very strong as we get towards the end of the year.
Helmy Eltoukhy: Yes. In terms of growth driver, I think what you are seeing really is the fact that, you know, it is just a very compelling test from a value proposition. So I think a lot of what you are seeing is some of the share gains, you know, from the sort of other tests in the market from, you know, other hospitals and so on. So that has been exciting. We are seeing a little bit of the sort of, you know, increase in testing in terms of longitudinally, but I would say that is a very minor part. I think that is still a lot of that is still another, like, major growth catalyst for us.
In the future that we have not really tapped into. And then the third piece is you know, this test has so many capabilities, things like, you know, being able to determine the type of cancer, what someone who has a cancer of unknown primary, sub. So if you think about the long tail of cancers where liquid biopsies and even tissue tumor biopsies are not really utilized, the fact, you know, that we have this smart platform with epigenetics and so on that can give so much more insight into tumor biology I think you are seeing penetration into some of these longer tail of cancers as well.
Operator: One more question, Cameron.
Operator: Our last question comes from the line of Daniel Anthony Arias with Stifel. You may proceed.
Daniel Anthony Arias: Yes. Good afternoon, guys. Thanks. Helmy, I just wanted to go back to REVEAL. You maybe talk about where things are on the commercial side when it comes to reimbursement and colorectal? What is a good ballpark number at this point for just the percentage of tests that are getting paid for, I guess, stage two and three patients would be the right subpopulation to ask about there. But I am really just trying to understand about for the side of CMS in your key indication there.
Michael Bell: Yeah. Dan, it is Mike here. It cut out a bit towards the end, but I think you are asking about Reveal reimbursements with CRC. CRC now is it is roughly 50% of our volume. It continues to be at that sort of level. And the rest being made at the moment from breast and lung and where we are getting reimbursed is for all of the now whenever we run a CRC test, getting reimbursed for all of these tests that we do for Medicare. And that is at the $1,640 rate. And we are getting good pull through with Medicare Advantage. We are starting to see traction with commercial payers. That is improving all of the time.
And so I think we are feeling good about where the reimbursement level is. And then as we look forward, we think there is continuous runway with Reveal. Again, more and more Medicare Advantage and commercial payments on the CRC side, but as we just mentioned, we are anticipating Reveal Breast reimbursement. We have submitted the data package to MolDx for Reveal IO. And so, hopefully, going forward, we are getting incremental Medicare reimbursement and incremental reimbursement from all of the payers as we move into 2026.
Operator: That was our last question. That concludes today's call. Thank you for your participation and enjoy the rest of your day.