Veracyte Inc. (VCYT) saw its shares plummet 8.28% in pre-market trading on Tuesday, despite reporting better-than-expected fourth-quarter 2024 earnings. The molecular diagnostics company's stock decline came despite an earnings beat and raised 2025 guidance, likely due to lingering analyst concerns over certain business segments.
For Q4 2024, Veracyte posted earnings of $0.36 per share, beating estimates by $0.07 and representing a 71.4% increase from the prior year. Revenues grew 20.8% year-over-year to $118.6 million, driven by a 44% jump in Decipher revenue and 4% growth in Afirma testing revenue. The company also issued upbeat 2025 guidance, projecting testing revenue of $470-$480 million and an adjusted EBITDA margin of around 21.6%.
However, Veracyte's product revenue declined 18% and biopharmaceutical/other revenue fell 30%, reflecting supply challenges and industry spending constraints. While Needham maintained its $51 price target on the stock, some analysts may be taking a cautious view on segments like product revenue until Veracyte demonstrates a turnaround. The earnings beat appears overshadowed by these lingering concerns for now.
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