EX-99.1 2 a991pressreleaseforearning.htm EX-99.1 Document

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Invitae Reports First Quarter 2023 Financial Results

– Reported revenue of $117.4 million, a 5% year-over-year decrease due to exited businesses and geographies; pro forma year-over-year revenue growth was ~10% –

– Continued improvement in gross margin and ongoing cash burn trends –

– Company reiterates key 2023 financial guidance metrics –

– Conference call and webcast today at 4:30 p.m. Eastern Time / 1:30 p.m. Pacific Time –

SAN FRANCISCO – May 9, 2023 – Invitae (NYSE: NVTA), a leading medical genetics company, today announced financial and operating results for the first quarter ended March 31, 2023.

“In the first quarter, our team continued to execute across the organization as we posted approximately 10% year-over-year growth in revenue on a pro forma basis, along with improved gross margins and reduced cash burn and we are reiterating our 2023 financial goals,” said Ken Knight, president and chief executive officer of Invitae. “Looking ahead, we are focused on expanding our current business along with investing in our growth engines. We are pleased with the recent clinical developments in our PCM assay for minimal residual disease, as we continue to take steps to advance a continuum of precision oncology. Furthermore, we are working opportunistically to improve our performance through revenue cycle management and working capital improvements. We are confident that these initiatives will strengthen our foundation as we move forward with our mission.”

First Quarter 2023 Financial Results

•Generated revenue of $117.4 million in the first quarter of 2023 versus $123.7 million in the first quarter of 2022, reflecting the impact of exited businesses and geographies announced in 2022. On a pro forma basis, or after removing approximately $17 million of revenue from first quarter 2022 relating to exited businesses and geographies, first quarter 2023 revenue grew approximately 10% year-over-year.
•GAAP gross profit was $28.9 million in the quarter, compared with $26.6 million over the same period of 2022, or 8.8% year-over-year growth. Non-GAAP gross profit was $56.2 million in the quarter, compared with $45.2 million in the first quarter of 2022, representing a year-over-year growth rate of 24.3%.
•GAAP gross margin was 24.6% in the quarter, as compared with 21.5% in the first quarter of 2022. Non-GAAP gross margin was 47.9% in the quarter, as compared with 36.6% in the first quarter of 2022.
•Cash, cash equivalents, restricted cash and marketable securities were $388.7 million as of March 31, 2023, compared to $557.1 million as of December 31, 2022.
•Net decrease in cash, cash equivalents, restricted cash and net changes in investments in the quarter was $171.5 million. Reported cash burn in the quarter was $193.9 million and included an outflow of $143.1 million related to financing activities. Excluding these items, ongoing cash burn would have been $50.8 million. This represents a continued improving trend since the fourth quarter of 2021. In addition to working capital improvement, in particular inventory management, ongoing


cash burn in the first quarter also benefited from accounts receivable reductions of approximately $13 million associated with the realignment of the previous Archer business.
•Revenue per patient was $463 in the quarter, compared to $416 in the first quarter of 2022, primarily as a result of our realignment efforts.
•Total patient population as of March 31, 2023 is approximately 3.9 million with over 63% available for data sharing.

Total GAAP operating expense, which excludes cost of revenue, for the first quarter of 2023 was $204.3 million. As a result, GAAP operating expense as a percentage of revenue was 174%, compared to 194% in the first quarter of 2022. Non-GAAP operating expense was $132.7 million for the first quarter of 2023. Non-GAAP operating expense as a percentage of revenue was 113%, compared to 169% in the first quarter of 2022.

Net loss for the first quarter of 2023 was $192.2 million, or a $0.77 net loss per share, compared to net loss of $181.9 million, or net loss per share of $0.80, for the first quarter of 2022. Non-GAAP net loss for the first quarter of 2023 was $93.7 million, or a $0.37 non-GAAP net loss per share, compared to a net loss of $177.4 million, or an $0.78 non-GAAP net loss per share, for the first quarter of 2022.

Financial Guidance

Management continues to expect 2023 revenue to be over $500 million, representing low double-digit year-over-year growth compared to 2022 pro forma revenue. The company also continues to expect its non-GAAP gross margin for 2023 to be between 48-50%.

In 2023, reported cash burn will be higher than ongoing cash burn as a result of the company’s voluntary repayment of its $135 million term loan in the first quarter of 2023. Ongoing cash burn is expected to be the same as the company’s previous guidance range of $250-275 million.

Webcast and Conference Call Details

Management will host a conference call and webcast today at 4:30 p.m. Eastern Time / 1:30 p.m. Pacific Time to discuss financial results and recent developments. To access the conference call, please register at the link below:

https://www.netroadshow.com/events/login?show=cd3e99e2&confId=49697

Upon registering, each participant will be provided with call details and access codes.

The live webcast of the call and slide deck may be accessed here or by visiting the investors section of the company's website at ir.invitae.com. A replay of the webcast will be available shortly after the conclusion of the call and will be archived on the company's website.

About Invitae

Invitae (NYSE: NVTA) is a leading medical genetics company trusted by millions of patients and their providers to deliver timely genetic information using digital technology. We aim to provide accurate and actionable answers to strengthen medical decision-making for individuals and their families. Invitae's genetics experts apply a rigorous approach to data and research, serving as the foundation of their mission to bring comprehensive genetic information into mainstream medicine to improve healthcare for billions of people.



To learn more, visit invitae.com and follow for updates on Twitter, Instagram, Facebook and LinkedIn @Invitae.

Safe Harbor Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the company’s mission; the company’s beliefs regarding the potential of its business, and its business priorities and initiatives and the potential benefits thereof; the company’s future financial and operating results, and the drivers of future financial results; the company’s focus, strategy, roadmap and product pipeline; and the company’s financial guidance for 2023. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to: the ability of the company to successfully execute its strategic business realignment and achieve the intended benefits thereof on the expected timeframe or at all; unforeseen or greater than expected costs associated with the strategic business realignment; the risk that the disruption that may result from the realignment may harm the company’s business, market share or its relationship with customers or potential customers; the impact of inflation and the current economic environment on the company’s business; the company's ability to grow its business in a cost-efficient manner; the company's history of losses; the company’s ability to maintain important customer relationships; the company’s ability to compete; the company's failure to manage growth effectively; the company's need to scale its infrastructure in advance of demand for its tests and to increase demand for its tests; the risk that the company may not obtain or maintain sufficient levels of reimbursement for its tests; the applicability of clinical results to actual outcomes; risks associated with litigation; the company's ability to use rapidly changing genetic data to interpret test results accurately and consistently; laws and regulations applicable to the company's business; and the other risks set forth in the reports filed by the company with the SEC, including its Annual Report on Form 10-K for the year ended December 31, 2022. These forward-looking statements speak only as of the date hereof, and Invitae Corporation disclaims any obligation to update these forward-looking statements.

Non-GAAP Financial Measures

To supplement the company's consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States (GAAP), the company is providing several non-GAAP measures. These non-GAAP financial measures exclude certain items that are required by GAAP. In addition, these non-GAAP measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similarly-titled measures presented by other companies. Management believes these non-GAAP financial measures are useful to investors in evaluating the company’s ongoing operating results and trends. Management uses such non-GAAP information to manage the company’s business and monitor its performance.

Other companies, including companies in the same industry, may not use the same non-GAAP measures or may calculate these metrics in a different manner than management or may use other financial measures to evaluate their performance, all of which could reduce the usefulness of these non-GAAP measures as comparative measures. Because of these limitations, the company's non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the non-GAAP reconciliations provided in the tables below and on the company’s website.

Invitae Contacts:

Investor Relations
Hoki Luk
ir@invitae.com


Public Relations
Amy Hadsock
pr@invitae.com







INVITAE CORPORATION
Consolidated Balance Sheets
(in thousands)
(unaudited)
March 31,
2023		December 31,
2022
Assets  
Current assets:  
Cash and cash equivalents$161,197 $257,489 
Marketable securities217,501 289,611 
Accounts receivable85,592 96,148 
Inventory19,070 30,386 
Prepaid expenses and other current assets20,908 19,496 
Total current assets504,268 693,130 
Property and equipment, net95,445 108,723 
Operating lease assets78,051 106,563 
Restricted cash10,034 10,030 
Intangible assets, net981,888 1,012,549 
Other assets21,977 23,121 
Total assets$1,691,663 $1,954,116 
Liabilities and stockholders’ (deficit) equity
Current liabilities:
Accounts payable$11,903 $13,984 
Accrued liabilities85,131 74,388 
Operating lease obligations16,374 14,600 
Finance lease obligations4,870 5,121 
Convertible senior secured notes, current portion (at fair value)71,902 — 
Total current liabilities190,180 108,093 
Operating lease obligations, net of current portion143,744 134,386 
Finance lease obligations, net of current portion2,529 3,780 
Debt— 122,333 
Convertible senior notes, net1,169,374 1,470,783 
Convertible senior secured notes, net of current portion (at fair value)211,036 — 
Deferred tax liability7,130 8,130 
Other long-term liabilities4,326 4,775 
Total liabilities1,728,319 1,852,280 
Stockholders’ (deficit) equity:
Common stock26 25 
Accumulated other comprehensive loss(108)(80)
Additional paid-in capital4,984,750 4,931,032 
Accumulated deficit(5,021,324)(4,829,141)
Total stockholders’ (deficit) equity(36,656)101,836 
Total liabilities and stockholders’ (deficit) equity$1,691,663 $1,954,116 




INVITAE CORPORATION
Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
 Three Months Ended
March 31,
 20232022
Revenue:
Test revenue$112,623 $119,497 
Other revenue4,733 4,194 
Total revenue117,356 123,691 
Operating expenses:
Cost of revenue88,442 97,116 
Research and development61,978 128,236 
Selling and marketing44,510 60,144 
General and administrative45,241 51,428 
Restructuring and other costs52,556 — 
Total operating expenses292,727 336,924 
Loss from operations(175,371)(213,233)
Other (expense) income, net:
Loss on extinguishment of debt, net(10,822)— 
Debt issuance costs(19,859)— 
Change in fair value of convertible senior secured notes18,304 — 
Change in fair value of acquisition-related liabilities218 10,003 
Other income, net5,883 436 
Total other (expense) income, net(6,276)10,439 
Interest expense(11,496)(13,985)
Net loss before taxes(193,143)(216,779)
Income tax benefit960 34,920 
Net loss$(192,183)$(181,859)
Net loss per share, basic and diluted$(0.77)$(0.80)
Shares used in computing net loss per share, basic and diluted249,907 228,470 








INVITAE CORPORATION

Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
 Three Months Ended March 31,
 20232022
Cash flows from operating activities:  
Net loss$(192,183)$(181,859)
Adjustments to reconcile net loss to net cash used in operating activities:
Impairments and losses on disposals of long-lived assets, net50,354 — 
Depreciation and amortization34,963 27,100 
Stock-based compensation29,193 46,822 
Amortization of debt discount and issuance costs3,022 3,883 
Loss on extinguishment of debt, net10,822 — 
Debt issuance costs19,859 — 
Change in fair value of convertible senior secured notes(18,304)— 
Remeasurements of liabilities associated with business combinations(218)(10,003)
Benefit from income taxes(960)(34,920)
Post-combination expense for acceleration of unvested equity and deferred stock compensation830 1,660 
Amortization of premiums and discounts on investment securities(2,949)570 
Non-cash lease expense3,111 1,286 
Other824 674 
Changes in operating assets and liabilities, net of businesses acquired:
Accounts receivable10,556 (14,172)
Inventory11,316 (9,941)
Prepaid expenses and other current assets(1,412)1,654 
Other assets163 (1,984)
Accounts payable(1,942)22,863 
Accrued expenses and other long-term liabilities8,557 (1,176)
Net cash used in operating activities(34,398)(147,543)
Cash flows from investing activities:
Purchases of marketable securities(126,053)(550,541)
Proceeds from maturities of marketable securities201,255 121,933 
Purchases of property and equipment(1,324)(20,848)
Net cash provided by (used in) investing activities73,878 (449,456)
Cash flows from financing activities:
Proceeds from issuance of common stock, net1 425 
Proceeds from issuance of Series B convertible senior secured notes due 202830,000 — 
Payments for debt issuance costs and prepayment fees(28,014)— 
Repayment of debt(135,000)— 
Finance lease principal payments(1,289)(1,330)
Settlement of acquisition obligations(1,466)(15)
Net cash used in financing activities(135,768)(920)
Net decrease in cash, cash equivalents and restricted cash(96,288)(597,919)
Cash, cash equivalents and restricted cash at beginning of period267,519 933,525 
Cash, cash equivalents and restricted cash at end of period$171,231 $335,606 


INVITAE CORPORATION

Reconciliation of GAAP to Non-GAAP Cost of Revenue
(in thousands)
(unaudited)
 Three Months Ended
March 31,
20232022
Cost of revenue$88,442 $97,116 
Amortization of acquired intangible assets(26,950)(18,000)
Acquisition-related stock-based compensation(80)(132)
Acquisition-related post-combination expense— (504)
Restructuring-related retention bonuses(88)— 
Inventory and prepaid write-offs(149)— 
Non-GAAP cost of revenue$61,175 $78,480 


Reconciliation of GAAP to Non-GAAP Gross Profit
(in thousands)
(unaudited)
 Three Months Ended
March 31,
20232022
Revenue$117,356 $123,691 
Cost of revenue88,442 97,116 
Gross profit28,914 26,575 
Amortization of acquired intangible assets26,950 18,000 
Acquisition-related stock-based compensation80 132 
Acquisition-related post-combination expense— 504 
Restructuring-related retention bonuses88 — 
Inventory and prepaid write-offs149 — 
Non-GAAP gross profit$56,181 $45,211 


Reconciliation of GAAP to Non-GAAP Research and Development Expense
(in thousands)
(unaudited)
 Three Months Ended
March 31,
 20232022
Research and development$61,978 $128,236 
Amortization of acquired intangible assets(90)(530)
Acquisition-related stock-based compensation(13,337)(23,769)
Acquisition-related post-combination expense(842)(2,581)
Restructuring-related retention bonuses(770)— 
Restructuring-related accelerated depreciation(184)— 
Non-GAAP research and development$46,755 $101,356 








INVITAE CORPORATION

Reconciliation of GAAP to Non-GAAP Selling and Marketing Expense
(in thousands)
(unaudited)
 Three Months Ended
March 31,
 20232022
Selling and marketing$44,510 $60,144 
Amortization of acquired intangible assets(1,569)(1,624)
Acquisition-related stock-based compensation(549)(583)
Restructuring-related retention bonuses(230)— 
Non-GAAP selling and marketing$42,162 $57,937 


Reconciliation of GAAP to Non-GAAP General and Administrative Expense
(in thousands)
(unaudited)
 Three Months Ended
March 31,
 20232022
General and administrative$45,241 $51,428 
Change in fair value of contingent consideration— (154)
Acquisition-related stock-based compensation(1,100)(1,572)
Restructuring-related retention bonuses(379)— 
Non-GAAP general and administrative$43,762 $49,702 


Reconciliation of Operating Expenses to Non-GAAP Operating Expenses
(in thousands)
(unaudited)
 Three Months Ended
March 31,
 20232022
Research and development$61,978 $128,236 
Selling and marketing44,510 60,144 
General and administrative45,241 51,428 
Restructuring and other costs52,556 — 
Operating expenses204,285 239,808 
Restructuring and other costs(52,556)— 
Change in fair value of contingent consideration— (154)
Amortization of acquired intangible assets(1,659)(2,154)
Acquisition-related stock-based compensation(14,986)(25,924)
Acquisition-related post-combination expense(842)(2,581)
Restructuring-related retention bonuses(1,379)— 
Restructuring-related accelerated depreciation(184)— 
Non-GAAP operating expenses$132,679 $208,995 








INVITAE CORPORATION

Reconciliation of Other (Expense) Income, Net to Non-GAAP Other (Expense) Income, Net
(in thousands)
(unaudited)
 Three Months Ended
March 31,
 20232022
Other (expense) income, net$(6,276)$10,439 
Change in fair value of acquisition-related liabilities(218)(10,003)
Non-GAAP other (expense) income, net$(6,494)$436 



Reconciliation of Net Loss to Non-GAAP Net Loss and Non-GAAP Net Loss Per Share
(in thousands, except per share data)
(unaudited)
 Three Months Ended
March 31,
 20232022
Net loss$(192,183)$(181,859)
Restructuring and other costs52,556 — 
Change in fair value of contingent consideration— 154 
Change in fair value of acquisition-related assets and liabilities(218)(10,003)
Amortization of acquired intangible assets28,609 20,154 
Acquisition-related stock-based compensation15,066 26,056 
Acquisition-related post-combination expense842 3,085 
Restructuring-related retention bonuses1,467 — 
Restructuring-related accelerated depreciation184 — 
Inventory and prepaid write-offs149 — 
Acquisition-related income tax benefit(170)(35,000)
Non-GAAP net loss$(93,698)$(177,413)
Net loss per share, basic and diluted$(0.77)$(0.80)
Non-GAAP net loss per share, basic and diluted$(0.37)$(0.78)
Shares used in computing net loss per share, basic and diluted249,907 228,470 




INVITAE CORPORATION

Reconciliation of Net Decrease in Cash, Cash Equivalents and Restricted Cash to Cash Burn
(in thousands)
(unaudited)
 Three Months Ended
 March 31, 2023
Net cash used in operating activities$(34,398)
Net cash provided by investing activities73,878 
Net cash used in by financing activities(135,768)
Net decrease in cash, cash equivalents and restricted cash(96,288)
Adjustments:
Net changes in investments(75,202)
Proceeds from issuance of Series B convertible senior secured notes due 2028, net of issuance costs(22,435)
Cash burn$(193,925)
• Cash burn for the three months ended March 31, 2023 includes $135.0 million repayment of debt, $8.1 million of prepayment fees, $3.7 million in restructuring-related cash payments, and $1.5 million of acquisition-related payments.