The following is a summary of the Exagen, Inc. (XGN) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Third quarter revenue reached $12.5 million despite a $1.2 million net negative impact from one-time adjustments.

• Adjusted EBITDA loss was approximately $4 million for the quarter, on track for a 30% improvement for the full year.

• Gross margin was 55.8% for the quarter, impacted by onetime adjustments; however, excluding these, the adjusted gross margin was 59.7%.

Business Progress:

• Exagen is nearing the commercial launch of new biomarker products through the AVISE CTD platform, expecting significant gains in ASP and margin expansion.

• A strong focus has been placed on refining commercial strategies and marketing for the impending launch of new biomarker assays.

Opportunities:

• The upcoming new proprietary biomarkers are anticipated to drive increased ASP and market demand, aligning with innovation and expanding market opportunities.

• Enhanced marketing campaigns and educational initiatives are lined up to support the commercial launch of new test products.

Risks:

• Seasonal factors and weather-related events impacted testing volumes and could pose continued operational risks.

• The $1.2 million in one-time adjustments to revenue due to a self-corrected CPT coding discrepancy and at-risk accounts receivable signify potential financial and operational vulnerabilities.

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