Myriad Genetics 10-Qquarter ended 2026-03-31
Impairment / charge
Mental Health growth and more Cancer Care tests offset Prenatal weakness, but lower Cancer Care revenue per test limited gains.
Filed 2026-05-06 06:05 ET
Key figures · Q1 FY2026 · period ended 2026-03-31
- Revenue$200.4MYoY +2.3%QoQ −4.5%
- Operating income−$30.7MYoY −5.9%QoQ −438.6%
- Net income−$34.1MYoY −34000.0%QoQ −331.6%
- Total assets$673.7MYoY −33.0%QoQ −4.7%
- Total debt$120.3MYoY +102.9%QoQ +0.3%
- Shareholders' equity$337.4MYoY −52.1%QoQ −8.3%
- Tangible book value$144.6MYoY −10.2%QoQ −11.3%
How this filing reads
- Health−0.4Cash fell to $124M after $22.2M quarterly FCF burn, against $120M debt at 10.2%.
- Momentum−0.2Revenue rose 2.3%; test volume was flat and operating loss widened to $30.7M.
- Outlook+0.1Oncology launches and FDA approval create growth options, though adoption remains unproven.
Executive Summary
Myriad Genetics grew Q1 2026 revenue modestly despite flat test volume: Mental Health growth and higher Cancer Care testing offset a sharp Prenatal Health decline and lower Cancer Care revenue per test. Gross margin held steady, but the operating loss widened, cash use continued, and a share-price decline prompted an impairment in Women’s Health. New oncology launches and diagnostic approvals offer growth opportunities, while reimbursement pressure and a costly, covenant-bound loan leave execution—not revenue growth alone—as the test for investors.
Key Financial Highlights
| Metric | Q1 2026 or 3/31/2026 | Investor interpretation |
|---|---|---|
| Revenue | $200M, +2.3% Y/Y | Growth came from mix and pricing differences, not more tests overall. |
| Gross profit | $138M, from $134M; gross margin 68.7% | Testing economics were broadly stable. |
| Operating loss | $(30.7)M, from $(29.0)M | Higher commercial spending and impairment outweighed gross-profit growth. |
| GAAP net loss | $(34.1)M, or $(0.36) per diluted share, vs $(0.1)M | The prior-year result benefited from a $29.3M tax benefit absent this quarter. |
| Total assets | $674M, from $707M at 12/31/2025 | Cash use and asset charges reduced the balance sheet. |
| Total stockholders’ equity | $337M, from $368M | Losses continued to erode book value. |
| Tangible common equity | $145M, from $163M | Excludes goodwill and net intangible assets. |
- Revenue mix: Cancer Care Continuum $120M, +4.0% Y/Y; Mental Health $38.3M, +23.5%; Prenatal Health $41.9M, −15.0%. Total volume was flat at 385,000 tests: Cancer Care volume rose 13% but revenue per test fell 8%, while Prenatal Health weakened on both measures.
- Cash conversion: Q1 OCF $(15.7)M vs GAAP net loss $(34.1)M; FCF $(22.2)M after $6.5M of capital expenditures and capitalized intangible assets. Cash and cash equivalents fell $25.2M during the quarter to $124M.
- Debt and financing cost: Long-term debt, net, $120M, backed by $125M of term-loan principal; the floating rate was 10.2%. Interest expense rose to $4.1M from $0.8M following the 2025 borrowing.
- Impairment: $5.4M of goodwill and long-lived asset charges included $4.5M that reduced Women’s Health goodwill to zero. This charge reflects a revised asset valuation, not a cash operating expense.
- Dilution: Shares outstanding rose from 93.5M to 94.4M during Q1; stock-based compensation was $6.5M. Proposed increases to equity-plan capacity could support further issuance.
Business Developments
Management’s stated strategy is to expand the Cancer Care Continuum menu, grow Prenatal Health and Mental Health at or above their markets, and improve profitability through operating discipline. Q1 results show the opportunity and the gap: Mental Health grew rapidly, but Prenatal Health contracted and Cancer Care’s higher volume did not translate proportionately into revenue.
Myriad launched Precise MRD with select oncology practices and advanced its commercialization timeline following new clinical data. The Food and Drug Administration approved MyChoice CDx as a companion diagnostic for Zejula in ovarian cancer; the company also continued its FirstGene study ahead of a planned full launch. These developments broaden potential oncology demand, but their contribution depends on clinical adoption and reimbursement.
Risk Assessment
- Reimbursement and test economics: Payer coverage limits, denials and recoupment requests can reduce collections or revise revenue estimates; Cancer Care revenue per test already fell 8% Y/Y.
- Liquidity and covenants: Q1 FCF was $(22.2)M, while the secured loan carries a rising minimum trailing-12-month revenue covenant and potential exit or prepayment charges; sustained cash use could constrain investment or financing choices.
- Valuation: A sustained share-price decline triggered the Women’s Health impairment; remaining goodwill of $47.1M depends on forecasts and discount-rate assumptions that could deteriorate.
- Litigation: A False Claims Act referral-related lawsuit has no material loss accrual; an adverse result beyond available insurance could materially affect cash flows or results.
- Floating-rate exposure: On $125M of facility principal, a 100 bp rate move changes annual interest expense by ≈$1.3M.
This 10-Q lists no risk factors of its own and refers to the annual report. The risks above come from the rest of this filing. Full list: FY2025 10-K.
Strategic Outlook and Investor Actionables
Myriad has oncology products to commercialize and a growing Mental Health business, but needs those gains to outpace Prenatal Health weakness, pricing pressure and cash costs. Next period, monitor:
- Test economics: Cancer Care revenue per test and Prenatal Health volume; stabilization would make growth less reliant on Mental Health.
- Cash and financing: OCF, FCF, cash balance and covenant headroom; narrowing cash use would support the stated profitability strategy.
- Oncology adoption: Precise MRD uptake and MyChoice CDx demand; commercial traction would validate investment in the expanded Cancer Care menu.
Figures are computed from the filing's XBRL data; the summary and scores are written by an AI model reading the filing.
Model 005 · prompt 9e47f58d3c