Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.23.1
Segment Information
 3 Months Ended
Mar. 31, 2023
Segment Reporting [Abstract]  
Segment Information Segment Information
The Company recognizes revenue under two reportable segments, (1) Clinical Services and (2) Pharma Services. The 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 self-pay patients. The Pharma Services segment supports pharmaceutical firms’ drug development programs by assisting with various clinical trials and research as well as providing informatics related services often supporting pharmaceutical commercialization efforts.
The financial information reviewed by the Chief Operating Decision Maker (“CODM”) includes revenues, cost of revenue, and gross profit for both reportable segments. Assets are not presented at the segment level as that information is not used by the CODM.
The following table summarizes segment information for the three months ended March 31, 2023 and 2022 (in thousands):

Three Months Ended March 31,
2023 2022
Net revenues:
Clinical Services $ 114,869  $ 98,791 
Pharma Services 22,351  18,378 
Total revenue 137,220  117,169 
Cost of revenue:
Clinical Services(1)
67,292  65,267 
Pharma Services(2)
15,114  13,670 
Total cost of revenue 82,406  78,937 
Gross Profit:
Clinical Services 47,577  33,524 
Pharma Services 7,237  4,708 
Total gross profit 54,814  38,232 
Operating expenses:
General and administrative 61,549  66,248 
Research and development 7,395  7,713 
Sales and marketing 16,259  16,299 
Restructuring charges 4,684  — 
Total operating expenses 89,887  90,260 
Loss from operations (35,073) (52,028)
Interest (income) expense, net (1,467) 1,301 
Other (income) expense, net 114  (168)
Loss before taxes (33,720) (53,161)
Income tax benefit (2,925) (3,753)
Net loss $ (30,795) $ (49,408)
(1) Clinical Services cost of revenue for both the three months ended March 31, 2023 and 2022 includes $4.3 million of amortization of acquired Inivata developed technology intangible assets.
(2) Pharma Services cost of revenue for both the three months ended March 31, 2023 and 2022 include $0.6 million of amortization of acquired Inivata developed technology intangible assets.