Conference Transcript - NEO 2026-06-04

Tucker Peterson, Analyst — Healthcare Group

Okay. We're going to kick it off. I'm Tucker Peterson from the healthcare team. It's my pleasure to introduce NeoGenomics. We've got the whole gang here, Tony Abhishek and Warren. So welcome to you all. Maybe just, Tony, just starting with a quick recap of 1Q earnings. You know, a month ago, just walk through, you know, you had beats on revenue and margins. What's working well, and how do you think about momentum the rest of the year?

Tony Zook, CEO

Yeah. Yeah. Thanks for the question, and thanks for having us. I would say, you know, it was a really strong execution quarter for us. We had our overall revenue was up about 11% year-over-year we had for the quarter our clinical business was really a driver there Tyco we did about 14% growth so that was extremely strong the big underlying driver within the clinical side is NGS which we've highlighted you know now represents over a third of our business that was growing at 26% we had anticipated that AUPs would show a step-up increase in fact towards the upper single digit and that's exactly where we came out volume Volume was actually a good driver for us as well. We expected kind of low and it ended up at mid single digit, so volumes were actually quite strong across the business as well. And then of course strategically we were able to secure reimbursement for Pantracer LBX to complement the Pantracer family, so that was a really good outcome for us for the quarter as well as the re-entry of Radar ST. So on a number of different fronts, both financially, AUP and volume, and then strategically with reimbursement it was it was a really strong quarter for us and maybe just uh tony stepping back you know you've been ceo now for a little over a year just talk a little bit about you know the top actions you've you've you know made to set up the organization for you know uh success here and what are the strategic priorities for the next nine twelve months ahead yeah sure well warren might be better to opine on what impact i've had so um but i i would say when i came on board tyco i i truly believe that the strategy was a solid strategy we knew where we wanted to go But like a lot of organizations, I think NEO had the affliction of trying to do too many things, right? You try and do too much, and you advance a lot of little ideas instead of the right big ideas. And so for me, it's always a constant mantra of focus and clarity. And any time we can simplify, we should. And to me, at the end of the day, what is it we want to do? We want to drive revenue, and we want to increase margin. I mean, it really comes down to those type of simple mantras into the organization. And on the revenue side, where did we want to go? We wanted to be equally well-known for not just the breadth of the portfolio, but the quality of it. And that it was beginning to come from our own labs. We were too dependent on BD and acquisition. And so really a strong focus on the development side of our organization. And I'm very happy with the progress we've made. We now see, you know, the Pantracer family has come through the system, you know, with LVX, with Pantracer Pro. We saw Radar ST, the introduction, the reintroduction of Radar ST, but equally two additional indications submitted to Mold DX. So I think the effort that's gone into the development side of the house is beginning to bear fruit. And on the gross margin side, I think, you know, the best decision I made was asking Warren to step in and lead not just commercial, but commercial and the lab so that we got this integrated teamwork happening at the lab. And there's a lot of work that's going on in the lab of the future concepts to drive gross margins. So we sit here today looking forward with a unique opportunity to say we can expand our revenue growth and at the same time expand margins. And so it's a good place to be because, again, just focus, focus, focus.

Tucker Peterson, Analyst — Healthcare Group

Abhishek, maybe a similar question for you. You made it through your first quarter here at CIFO. Let's just talk a little bit about your priorities here as, you know, stepping into the role.

Abhishek Jain, CFO

Absolutely. I think it's the same, what Tony basically just kind of elaborated. My top priority is to basically make sure that we continue to fuel the revenue growth. That stays the most important one. How do we kind of make the rightful investments in our sales team, in our innovation, and the pipeline of the products that we need to continue to have to be staying ahead of the market there. So that's the number one. And number two, as I kind of step in, I see a lot of opportunity for us as we look for the gross margin expansion and using the operating leverage to actually drive the adjusted with our margins more meaningfully. So those are the two key pieces that I would work on.

Tucker Peterson, Analyst — Healthcare Group

Why don't we flip to ASCO. You had a busy conference at Abstracts. Just high level, you know, talk about, you know, from your meetings, feedback, sentiment, and some of the presentation takeaways?

Warren Stone

Yeah, thank you, Taika. We had a very exciting ASCO actually come directly from there, to be frank. Granny wrapped up at lunchtime on Tuesday. So, you know, every year we've seen an improvement in terms of the value we see from ASCO, and we've been working hard in terms of the abstracts that we present at ASCO, and obviously the meetings that we coordinate, both in terms of around those abstracts, but also in terms of the larger business. I come back very enthusiastic. You know, we were oversubscribed in terms of the number of meetings that we could actually The interest in neogenomics is stronger than ever, both from a clinical perspective, but also on our non-clinical, so pharma and ODS. So yeah, we've really used those four days to significantly advance our pipelines and also identify a number of new opportunities. So really optimistic as we start to head into the second half of the year.

Tucker Peterson, Analyst — Healthcare Group

And maybe just talk on some of the data. You know, you've got survive, survive heroes, you know, basically pointing toward treating patients to the point of molecular relapse ahead of imaging. Talk about, you know, how you're, you know, moving forward with an interception model.

Warren Stone

Yeah, so I think for us this data is becoming, as we all know, critically important in terms of adoption, et cetera. Those are studies that we've had for a long time, and we're starting to start to see the sort of interim report outs, And that's going to be critical as we expand our coverage from a radar AST perspective in the breast space. So expect more to come on that, certainly in the second half of this year and the beginning of next year.

Tucker Peterson, Analyst — Healthcare Group

And how about real-world evidence? I think you had a poster just bridging the gap between clinical utility and coverage for unreimbursed.

Warren Stone

That was incredibly – the amount of people that actually came to see that presentation was incredible. I think it's just a demonstration of how physicians recognize the challenges associated with getting paid. And there was a simple poster that basically said here was, I think it was a small set of 3,500 tests that we had resulted but didn't get paid for. And then we looked at how many of those actually had actionable mutations in them and how many of those actually resulted in a different treatment. And of 3,500, there was roughly, I'm rounding here, roughly 500 actionable mutations. And of those 500, almost 300 of those patients had a change in treatment as a result of the testing that we provided. So again, shows the utility of the testing and why it should be reimbursed. And it was just, it was incredible to see the sort of groundswell that's starting to form around sort of reimbursement. And hopefully that's a positive indication for us in terms of getting better reimbursement for CGP and large panel testing, because that's still the biggest source of denial today.

Tucker Peterson, Analyst — Healthcare Group

And maybe we could just touch on RadarST and early traction launched at late February. You gave some metrics on the 1Q call on, I think, 29% return customers, 34% cross-selling, but just talk a little bit about momentum in the field.

Warren Stone

Yeah, absolutely. So we're really excited to be back on the market. We launched at the end of February of this year, so being on the market roughly three months. Uptake has been really good. We're encouraged to see some past users of Radar when we're in the market in 2023. Roughly 29% of the users that we've seen in 2026 is from that tranche in 2023. So that was very encouraging. We're seeing a good attachment rate, a little north of a third, where Radar's coming in, but coming in with other CGP testing and add-on as well, which was, again, for us, a demonstration of the value of the portfolio that we have. so I was really really pleased to see that I think additional aspects not a surprise we're seeing most of our volume coming in in the head and neck HPV negative because we're first to market there and and there's been some success on the HPV positive side so those physicians were looking for a solution on HPV negative and we've we've seen the strongest demand there followed by breast which is obviously the other indication that we've launched and we're seeing some some good demand although we're not actively promoting this this stage we are accepting testing for the two additional indications that we have submitted to maldx in december of last year we anticipate approval by the end of this year so we we're accepting those those tests because we want to prime the pump and starting to see some really good traction building there as well so we you know we've got um well over 30 physicians now that have ordered a double digit number of tests So we're seeing repeat usage, et cetera, which is encouraging. So the primary two focuses for us is really around increasing number of physicians that are using the test and getting into workflow. So embedding it into the bidirectional interfaces and EMR so that we can simplify the workflow. Laser focused on that for the rest of the year, and outlook looks very promising. And maybe just on that latter point, talk about next steps on workflow, just EMR integration. yeah yeah so we we spoke uh earlier this year about the fact that we're now part of epic aura this was important because although we have a lot of epic interfaces today probably over a hundred they were bespoke hl7 interfaces and then it's harder to actually maintain and update the compendium the beauty with epic aura is updating compendiums and actually initial establishment as well significantly easier and and we knew that we're going to have to update compendiums much faster as we bring radar out and additional indications becoming available so we time that implementation of aura accordingly so um we have a number of physicians or physician practices in hospitals that now have radar in their compendium and we continue to work to to drive growth and then just thinking that you mentioned the one-third attach rate do you think that's kind of where where we stabilize or does that go up or down over time um you it's interesting because We're only a quarter in, but we've seen a pretty consistent trend here. It hasn't decreased, and as we bring on new physicians, the same trend seems to stick. So initially, it seems to be a good position at this junction. I think it's too early to tell, and probably by the end of this year, get my months under the belt, we'll probably have a much more robust metric to use there.

Tucker Peterson, Analyst — Healthcare Group

And then you've got it mid-single-digit millions in revenues from Radar this year. Just talk a little bit about, you know, what that assumes for volumes and ASPs and other toggles there.

Abhishek Jain, CFO

Yeah, I would say type on that one too early and we are not calling out very separately the volumes and the ASP because we are just resuming $5 million, mid-single digit there for the radar. Once we have a little bit more traction on this one, then we'll start to provide more color on the volumes and AUPs.

Tucker Peterson, Analyst — Healthcare Group

And can you maybe just touch on the margin profile? How we think about full-scale margins for radar?

Abhishek Jain, CFO

For radar, I would say that as we kind of get to the scale, it's going to be very similar to some of the other companies that we have seen in this particular space where you will be seeing some headwinds on the gross margin because you will not have the coverage from the commercial pairs. But the good news with neogenomics is that we have a lot of contracts. We have 300-plus contracts with our pairs. So that gives us an easy foot in the door, and we are already having those conversations with those commercial peers to be able to kind of get the policy and the coverage. But initially, in the first year or two, yes, this will be a little bit of a gross margin headwind that we plan to offset with many of the other initiatives that we can get into the details so that we kind of keep the balance of the gross margin and the profitability. But in the short term, we'll see some headwinds.

Tony Zook, CEO

The only thing I would add to that, I mean, this would be expected on most of any new product launch, right? You know, your first 18, 24 months, you take a little bit. When we prioritize where we want to take our R&D spend, I would also tell you one of the highest priorities for us is label expansion, not just for radar ST, but for the next-gen MRD as well, because you get the added benefit of not just, you know, opportunities that you can drive revenue, but you then get the bad debt kind of question off the table. And so I think any investments that we continue to make on the D side will be heavily biased towards, at least in the MRD segment, label indication expansion for those various reasons.

Warren Stone

And maybe just – oh, go ahead, Warren. I was going to say, I was going to add on a little bit on the gross margin. We still have – obviously, in terms of reimbursement, it plays a big role in terms of what gross margin you get. But I do think there is still meaningful opportunity around how we improve our sort of gross margin efficiency. So today we still run on the 6,000. We will move to the X. So that's going to both improve turnaround time, which is obviously critically important for patients and physicians, but also it'll significantly drive down costs as well, because there's probably a 30% leverage there that we can go after as well. So, yeah, it'll probably be somewhat dilutive initially, but it's going to be very attractive in the medium term.

Tucker Peterson, Analyst — Healthcare Group

Is that transition happening this year?

Warren Stone

We won't, not for radar. It'll happen early next year, but we're moving other parts, other modalities this year. So we're focusing on our liquid biopsy first this year, moving to the X. That'll be complete in the third quarter. And we're also moving our heme NGS large panel onto the X as well this year. That may roll into the first quarter next year, but we'll have most of the benefit for 2027.

Tucker Peterson, Analyst — Healthcare Group

And then, you know, you touched on some of the newer indications, IO monitoring, non-small cell lung, you're seeking mold X coverage, obviously. Just talk a little bit about, you know, how we think about additional data, how you think about the clinical opportunity and how you differentiate in those areas?

Warren Stone

So we haven't confirmed those indications, just to be clear, so I'm not going to confirm or deny that those are accurate at this point. But you would have seen that there was a lot of that data at ASCO and other ACR, et cetera, so I understand what's leading to that point. I think, again, we're really excited about those new indications coming to market in the second half of the year. It more than doubles our opportunity. And importantly, we have a robust data set in terms to help seed the market and convert the market at the end of the day. And again, based on the data, you can see that we have the ability to detect down to one PPM, which is really coming through in the data, which puts us in a strong position as we expand indications.

Tucker Peterson, Analyst — Healthcare Group

And then maybe spend a minute on sales channel. I think you've talked about hiring 25 new reps. Just talk about, you know, pacing of the hiring, how you think about, you know, the channel you're ultimately going to need here.

Warren Stone

Yeah, it's a great question. Something we talk about regularly internally. So we've committed to adding 25 additional what we call oncology cell specialists. So those are the teams that goes directly after the oncology segment. And they largely promote solid tumor therapy selection, MRD and heme therapy selection. So a narrower portfolio. And that'll take our total sales team to 165. Those should be on board within the third quarter of this year. So we've started that process already. And sort of as we expand on indications even further, and we've looked at the sort of reach aspects and the opportunity from a reach perspective, I think you should anticipate further expansion into 2027 as well.

Tony Zook, CEO

Yeah, the only point I would add, because we've gotten questions kind of around not just this year, but what is the outlook on Salesforce? in other areas of the company, where would we see some kind of change in kind of P&L management? And what I would say at the highest level, you know, first and foremost, where are we under indexed? It's certainly on the selling side, right? Today we're at like about 13% of revenue on sales and marketing. You know, we should continue to invest pragmatically in the selling force, right? So that's an area that we should expect as a percentage of revenue. It might increase just a little bit. The other areas, and on the R&D side, we've only been at about 5%. of revenue. Even if you just break it out as a percentage of NGS, it's still relatively low versus competitors. So we'd like to see some stepwise increase on the D side of our investment levels. And so where's the trade-off going to come? We think we're in the early innings on efficiency plays within neogenomics. We anticipate our GNA as a percent to come down rather significantly over the next 18 to 24 months. And as well, because we can leverage efficiencies, AI, a lot of other areas you know the the head count numbers are relatively flat if not down in other parts of the company to offset some of these things so we think we'll end up with a healthier p&l better sales force coverage and a more productive r&d group um let's hit on pan tracer then you know you've launched in both tissue and liquid how do you think about the interplay between the two and you know are you sensing a paradigm with greater you know transition over to liquid yeah great we get there often and and again we sort of got reimbursement on our liquid uh assay in march of this year and uh that was sort of when we put the uh the pedal to the metal so to speak in terms of

Warren Stone

promotion out there and again just to level set everybody we're laser focused on the community with our pan tracer portfolio um which includes the tissue and the liquid uh today we still see very much a tissue first type mindset in the community with the exception with in lung and it is guideline driven as to why we see that exception where we we see a fair amount of concurrent testing across lung where tissue and liquid are done together we so most of the existing pan tracer tissue users seem to be using as a reflex space so we have a qnstmp where there's no tissue available they move to liquid and that's sort of been our positioning strategy for new customers that were maybe not adopters of the pan tracer family or pan tracer tissue we are seeing sort of a liquid first approach there as well and we sort of part of this is the fact that we seem to be able to secure the block relatively easy compared to other peers in the market largely because of a very very strong relationship with pathology so we don't have big lead times to get the block so turnaround times between liquid and solid tumor are not significantly different and and i think you've talked about tissue uh actually growing faster since you rolled out liquid i guess how sustainable is that acceleration that you're seeing yeah very good point i think overall the category of our pan tracer family is growing really really well i want to put that out there certainly as a as a percentage liquid biopsy is growing the fastest because it's a small base but pan-tracer tissue is definitely there's been a gear change or a step change as a result of the introduction of liquid and you know again we focused on the community and and we still see a lot of runway ahead of us in terms of the pan-tracer family portfolio including tissue there are still many physicians out there that have adopted sort of single gene or targeted panel approaches that there's a conversion opportunity and and Unfortunately, there's still many patients that get their relative therapies without any form of NGS today. So I think the opportunity is rife.

Tony Zook, CEO

On the sustainability question, I guess through two lenses, if we look at 26 and then we look beyond, right? What we said in the guide, if you recall last year, our NGS growth rate was about 22%. We said that this year we weren't quite sure when we would get LBX. We anticipated it to be in Q1 or right thereabouts. So we said we should at least match our NGS growth rate in 2026 on the bigger base. Once we secured LBX, I think we would safely say we'd be disappointed if we didn't surpass the 22% growth rate that we experienced last year. So this year we think our NGS growth rate will be at least, but surely should be better for the year. And then looking forward, over the next few years, we don't see why we wouldn't continue to outpace market growth rather significantly. You're not committing to a final number yet, but we think certainly it's sustainable over the next few years.

Tucker Peterson, Analyst — Healthcare Group

And can you maybe just, stepping back, talk about the strategy to differentiate? I mean, therapy selection, MRD, you've got a number of incumbents here. These are increasingly crowded markets. How do you differentiate with Radar and MPAN Tracer and ultimately defend sharing the community side too?

Warren Stone

I think for us, it's all about the portfolio play, is first and foremost. We have breadth of portfolio, which stems diagnosis, therapy, selection, and MRD across solid tumor and heme. We have a very strong position in heme. We believe we're the market leaders of heme. And ultimately, that gets us access. And we also have well over 330-odd bidirectional interfaces in place already serving those customers. so that the portfolio is really what we drive uh we're also known for a very very strong customer experience that we offer um we continue to survey customers etc to get feedback uh mps scores in and sort of high 70s low 80s um and and low 80s for oncologists in particular so they appreciate the breadth of portfolio and the frictionless experience that we provide to them um and you we've been very successful coming back to our commercial strategy of protect expand acquire we protect our existing customers and then we expand share of wallet or same store sales however you want to phrase it so whenever we bring a new product in the first place we go to is existing customers who have a very good affinity with neo genomics appreciate the value proposition and and we layer in the additional product and since 2023 when we put the strategy in place there's been strong evidence that it works really, really well. And it's continuing to work on pan-tracer liquid and early signs on MRD signal the same thing.

Tucker Peterson, Analyst — Healthcare Group

And on the heme business, I mean, we tend to think about that as about a billion-dollar market, 40% penetrated or so. I guess, how do you think about, you know, the runway that's left here? Is there an opportunity to accelerate the conversion of that TAM, expand it potentially? And I know I think we think about double-digit kind of growth in line with the market for you guys.

Warren Stone

Yeah. So I think that's actually a really great question. And coming out of ASCO, one of the things that I always do when I wander around and assess the market is I look at the pharma companies and I look at what therapies they've got in third phase clinical trials, both on solid tumor and on heme. And there's been an emerging trend over the last couple of years that there's more and more heme trials that are in third phase clinical trials or later, which is an indication that there are more therapies coming to market. More therapies come in the market means more therapy selection testing. So I do believe that the outlook from a therapy selection perspective in HEME is particularly robust, driven by the onset of more and more therapies becoming available. So exciting space to be in.

Tucker Peterson, Analyst — Healthcare Group

The pharma services business, you left the guidance there unchanged, but you've talked about some green shoots. Maybe just talk about what you're seeing in the market, what's giving you some optimism, and do new product introductions in MRD and liquid biopsy provide some additional upside here?

Tony Zook, CEO

Yeah, I'll kick us off, and then Warren can go into more detail relative to bookings and things of that nature. Again, just to level set, everyone, you know, the pharma side of our business is a relatively small percentage, about 5% to 6% of our business. What we anticipated coming into this year is, you know, we have seen the last two years of, you know, almost 20% declines in that business year over year. We thought that this would be a year that we could get that to kind of flat to low, mid-single digits, and that's still the anticipation for this year. We believe that, you know, it's a business by the close. It'll be, you know, 4% to 5% year-over-year decline, but poised for growth going into 2027. And the reason we're confident in that stems from, first off, we take accountability for on the execution side. We have a new management team in place that's really hitting on all cylinders now. And as Warren will go into more detail, we are beginning to see bookings and things of that start to work its way through the system. Plus, as he's already highlighted at the macro level, much less resistance and more investment happening in the space. So Warren, any more additional details?

Warren Stone

No, I think that's a great, you've covered a lot, Tony. I think just coming out of ASCO, it's a good sort of barometer for me as well in terms of two things. I think there is more optimism in the pharma biotech space today than what there was a year ago. despite all the macroeconomic geopolitical I think people are just leaning into this and realising that it's a bumpy world out there but they're leaning in I think we've seen increased demand for our testing from a farmer perspective that we're seeing in the bookings coming in so we're seeing increased bookings and that for us is a leading indicator of revenue to come and what is attractive for us the bookings value so the profitability and the value of the bookings are increasing too so that's another positive indicator for us as we head into the second half of the year and into 2027 so we we expect this year pharma will still be marginally down um sort of low single digits but return to growth in 2027. it is nice to have a seat at the table though you know and i think that is some of the added benefit of having radar st having lbx you at least are now with more relevant topics in front of pharma that you could then extend with IHC and other areas.

Tony Zook, CEO

So that's been a good positive signal for us.

Tucker Peterson, Analyst — Healthcare Group

I want to hit on Pathline briefly. You know, it's been a year or so since you did the deal. Maybe just talk about how that's played out relative to expectations and, you know, what improvements have you brought to the business, you know, since you acquired it?

Tony Zook, CEO

Yeah, I think strategically it's done everything we could have hoped for and more. I think if you recall when we go back, the rationale for this was to be able to better serve customers in the northeast area of the country. When you step back and you looked at the growth maps across the country, it's not a surprise that where we can provide greater service in rapid turnaround time, you have a greater market share penetration. That was not the case for us in the northeast. We were kind of lagging there from a growth perspective versus the other regions. And the way to offset that was to strengthen the presence, be able to provide customers that rapid turnaround time when they needed it. And so that's what led ultimately to the Pathline acquisition, which we've got at a really good price. I think the team there, with Warren's help through the labs as well as through everyone, we've been able to onboard the tests as fast as we would have expected, if not even a little bit better. So that integration has gone extremely well. and then the biggest proof of the pudding is what's happened to the growth rate in Northeast and in fact our Northeast region last quarter grew one and a half times faster than the other region so it is showing that progress is being made.

Warren Stone

I can provide one customer quote just in the interest of time. I had dinner in Long Island last night with a customer who has been a long-standing customer but we've struggled to really win a meaningful share of their business and the quote from this customer was the acquisition of the Ramsey site has been transformational in the service we're providing.

Tucker Peterson, Analyst — Healthcare Group

I want to make sure we hit on capital deployment quickly before we wrap here. I mean, just given where the stock is today, how are you thinking about buybacks versus paying down debt as well as maybe additional bolt-on deals?

Abhishek Jain, CFO

Yeah, I think the first priority for us is to get the convert behind us, Tyco. We are basically kind of talking to the leading banks, And what I'm hearing is that this probably is one of the best times for the convert refinance. But we are looking at a wide variety of options here, not necessarily just the convert. We have the $145 million in bank, and we would want to kind of leverage our balance sheet a little bit. And at the same time, we would want to make sure that we are not diluting or potentially diluting our shareholders. So evaluating the options and giving our financial profile where we are a solid double-digit grower, a positive adjusted EBITDA, and hopefully we will be free cash flow positive by the end of this year. We are in a position of strength, and we look forward to getting this past us well ahead of its maturity. so this is the first priority I think on the M&A and the other pieces I would say that we'll look for more the partnerships for now because we have a lot of products that we have recently brought to the market and there's a lot of work that needs to get done and then we have a lot of shots at gold from the pipeline standpoint as well with some of the MRD on the radar side the next gen MRD that we're talking about as well as some of the other actions that we are taking on the HEME WGS side.

Tucker Peterson, Analyst — Healthcare Group

And then maybe just last one quickly on the longer-term outlook here. I mean, for this year, you're getting 30% EBITDA growth, 100 BIPs of margin expansion. You know, in the past, you've talked about mid-50s, GMs, mid to high teens, EBITDA margins. Is that still the right profile of the business?

Abhishek Jain, CFO

I would say that, yes, if you take a longer-term view, that would be the right profile to kind of think about. But, again, for the short term, as we kind of ramp up our radar and some of the other testing, We will basically have to make sure that we kind of continue to look forward as to how we drive the balance and expand our margins. There are multiple ways that we can potentially do it. For example, on the gross margin, we are looking at expanding that because our AUP growth has been pretty strong. That's the first driver. The second one, of course, we have been talking about the lab of the future where we have the distal pathology and the lab automation as number one. Number two, moving towards the NovaSeq X would be the other piece. And the third and the fourth would be like footprint rationalization as well as the strategic sourcing. So there are multiple drivers to be able to kind of drive the gross margin expansion. And then looking at the operating leverage, going back to what Tony basically said, that we look to make investments in the sales and perhaps the D side of the R&D line. but we would want to kind of drive the gross margin as a percent of revenue in a much more efficient manner so that we get the leverage benefit to be able to drive those benefits to the adjusted beta line more meaningfully as we move forward in 27 and beyond.

Tucker Peterson, Analyst — Healthcare Group

Great. I know we're over time. We'll leave it at that. Thanks.