What happened
Shares of Sema4 Holdings (WGS -6.09%) are crashing today, down by 31.9% as of 11:08 a.m. ET. The steep decline came after the company provided its second-quarter update following the market close on Monday.
Sema4 reported Q2 revenue of $36.2 million, down from $47 million in the prior-year period. The company posted a net loss of $85.7 million based on generally accepted accounting principles (GAAP). Its adjusted net loss totaled $72.9 million, significantly worse than the adjusted net loss of $43.5 million in the prior-year period.
The company also lowered its full-year revenue guidance. Sema4 previously projected 2022 revenue of between $305 million and $315 million. It now expects full-year revenue will be between $245 million and $255 million.
Furthermore, Sema4 announced a major restructuring. Founder Eric Schadt, who served as president and chief R&D officer, is leaving the company. Sema4 is also pulling out of the somatic tumor testing business and eliminating roughly 13% of its workforce.
So what
Sema4's Q2 update seemed to be a fulfillment of the old saying, "When it rains, it pours." There was so much negative news, it's hard to say which specific item made the biggest impact on the healthcare stock.
One bright spot, though, is that Sema4's restructuring should help the company achieve over $150 million in savings per year. Sema4 expects to realize around $200 million in cost savings by the end of next year.
Now what
The company will have new leadership driving its technology direction following Schadt's departure. Matthew Davis is now Sema4's chief technology and product officer. He previously headed up Invitae's artificial intelligence and data group.
