Segment Information

6 Months Ended

Jun. 30, 2021

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company has two operating segments for which it recognizes revenue; Clinical Services and Pharma Services. The Company’s Clinical Services segment provides various clinical testing services to community-based pathology and oncology practices, hospital pathology labs and academic centers with reimbursement from various payers including client direct billing, commercial insurance, Medicare and other government payers, and patients. The Company’s Pharma Services segment supports pharmaceutical firms in their drug development programs by supporting various clinical trials and research as well as providing informatics related services often supporting Pharma commercialization efforts.

The financial information reviewed by the Chief Operating Decision Maker (“CODM”) includes revenues, cost of revenue and gross profit for each of the Company’s operating segments. Assets are not presented at the segment level as that information is not used by the CODM.

The following table summarizes the segment information (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Net revenues:
Clinical Services	$	101,405	$	73,884	$	197,892	$	166,866
Pharma Services	20,319		13,093		39,365		26,141
Total revenue	121,724		86,977		237,257		193,007
Cost of revenue:
Clinical Services(1)	57,233		48,757		118,798		97,680
Pharma Services	11,501		10,214		23,895		20,952
Total cost of revenue	68,734		58,971		142,693		118,632
Gross Profit:
Clinical Services	44,172		25,127		79,094		69,186
Pharma Services	8,818		2,879		15,470		5,189
Total gross profit	52,990		28,006		94,564		74,375
Operating expenses:
General and administrative	54,638		34,613		95,114		70,957
Research and development	3,495		2,105		5,951		4,165
Sales and marketing	17,224		10,195		30,973		23,453
Total operating expenses	75,357		46,913		132,038		98,575
Loss from operations	(22,367)		(18,907)		(37,474)		(24,200)
Interest expense, net	902		1,548		2,079		2,367
Other income, net	(171)		(7,405)		(341)		(7,628)
Gain on investment in and loan receivable from non-consolidated affiliate, net	(96,534)		—		(91,510)		—
Loss on extinguishment of debt	—		1,400		—		1,400
Loss on termination of cash flow hedge	—		3,506		—		3,506
Income (loss) before taxes	73,436		(17,956)		52,298		(23,845)
Income tax benefit	(2,437)		(11,132)		(1,461)		(10,043)
Net income (loss)	$	75,873	$	(6,824)	$	53,759	$	(13,802)

(1) Clinical cost of revenue for the three months ended June 30, 2021 includes $0.7 million amortization of acquired intangible assets. Clinical cost of revenue for the six months ended June 30, 2021 includes $0.7 million amortization of acquired intangible assets and write-offs of $5.3 million for COVID-19 PCR testing inventory.