SOPHiA GENETICS SA Q1 FY2026 Earnings Call

Good morning. My name is Vincent, and I'll be your conference operator today. At this time, I would like to welcome everyone to the SOPHiA GENETICS First Quarter 2026 Earnings Conference Call. Kellen Sanger, SOPHiA GENETICS VP of Strategy, you may begin.

Thank you, and good morning, everyone. Welcome to the SOPHiA GENETICS First Quarter 2026 Earnings Conference Call. Joining me today to discuss our results are Dr. Jurgi Camblong, our Co-Founder and Chief Executive Officer; Ross Muken, our Company President; and George Cardoza, our Chief Financial Officer. I'd like to remind you that management will make statements during this call that are forward-looking statements within the meanings of federal securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated, and you should not place undue reliance on forward-looking statements. Additional information regarding these risks, uncertainties and factors that could cause results to differ appears in the press release issued by SOPHiA GENETICS today and in the documents and reports filed by SOPHiA GENETICS from time to time with the Securities and Exchange Commission. During this call, we will present both IFRS and non-IFRS financial measures. A reconciliation of IFRS to non-IFRS measures is included in today's earnings press release, which is available on our website. With that, I'll now turn the call over to Jurgi.

Thanks, Kellen, and good morning, everyone. I'm pleased to report that SOPHiA is off to a strong start in 2026. In the first quarter, we delivered revenue growth of 22% year-over-year. We also performed a record 108,000 genomic analyses as demand for SOPHiA DDM accelerates across the globe. In addition to processing more data volume than ever, we also achieved adjusted gross margin of 75.4%, demonstrating the unique scalability of our hyper-efficient analytics platform. Ross and George will walk you through the commercial and financial details in a few minutes. But first, let me step back and frame why this quarter matters strategically. The precision medicine landscape is at an inflection point. Sequencing costs are declining, data per patient is exploding, and AI is becoming essential for delivering the highest standard of care. As a result, hospitals and labs around the world are increasingly looking to scale their genomics testing capabilities. With the right partners, turnaround times become faster, economics become profitable and data generated becomes invaluable for performing research and making discoveries. SOPHiA DDM was built for this moment. Our platform streamlines testing and allows any institution anywhere in the world to quickly scale their own world-class precision medicine capabilities. SOPHiA DDM provides customers with not just a tool, but an AI-native service that delivers workflow outcomes, generating highly accurate insights and faster speeds while also unlocking profitable economics for institutions. But that's not all. SOPHiA DDM also makes patient care more intelligent by breaking data silos and allowing clinicians to tap into a collective intelligence of the smartest minds in health care. As hospitals use SOPHiA DDM to generate insights and treat patients, they also contribute a stream of data and knowledge back into the platform. As more data flows through the platform, our algorithms become smarter. This in turn enables hospitals and clinicians to get better insights, building trust along the way. Deeper trust, smarter insights and better outcomes ultimately accelerates new platform adoption, creating a virtuous loop with compounding growth effects. As of Q1, this adoption loop has enabled us to connect 537 institutions across the globe who use SOPHiA DDM every day for genomic analysis. In the quarter, these institutions uploaded real-time, real-world genomic data for 108,000 patients. And in March, we set a new company record with more than 40,000 patients analyzed in a single month. This diverse real-time, real-world data stream includes patient data from 75 countries worldwide, creating breadth and global exposure and is unmatched in our space. Over the past two years, our rich diverse data set, which includes nearly 2.5 million genomic profiles since inception, has enabled us to build some of the most sophisticated AI in health care. New applications in liquid biopsy, solid tumor, MRD for AML and enhanced exomes are impressing our users with their accuracy, flexibility and AI-powered insights. And the good news is we're just getting started. Our top innovation priorities going forward will focus on deepening clinical relationships and getting closer to the patients. To accomplish this, we will expand platform capabilities to new areas as the market evolves. This includes supporting larger, more complex NGS applications like all-transcriptome and methylation, tracking patients longitudinally with MRD, mastering data compute at scale, optimizing the end-to-end workflow and developing increasingly regulated products. It also includes expanding capabilities beyond genomics into multimodal to support clinical decision-making and accelerate the future of data-driven medicine. Our planned innovations are also designed to resonate with biopharma. Throughout the year, we will invest in evolving our data sets into durable commercial assets for real-world evidence. In addition, we are working hard to create a global decentralized companion diagnostics offering that brings life-saving therapies to patients across our network. In short, our unique positioning and data set are enabling us to build for the future. We have been a technology company since day one, building real AI to solve the world's most difficult biological challenges. The market is coming to us, and I couldn't be more confident in our ability to deliver products for future growth. As we continue to invest in the future, we also must remain committed to growing in a sustainable way. Across the organization, our teams are hyper-focused on continuous improvement, efficiency and operational excellence. We benefit from a young, agile and tech-centric workforce that has been quick to adopt and deploy emerging productivity tools, including new AI technologies in the market. Early results from our internal rollout of these AI tools have been overwhelmingly positive. In Q1, we materialized the benefits of recent efficiency gains and took a series of targeted cost actions, which modestly reduced headcount and non-labor spend across the business. These actions, which mostly focused on support and operations functions, have allowed us to invest even more in high-growth areas while also ensuring that we meet our profitability commitments going forward. As the year continues, we will look forward to updating you on our progress in showcasing the impressive operating leverage that is innate to our business model. In closing, Q1 was a strong quarter for SOPHiA. The market is reshaping itself around intelligence, and we are perfectly positioned to accelerate this movement. Our network is compounding and our data is unmatched. We continue to scale and our path to profitability is becoming increasingly clear. As I close out my final earnings call as CEO before I transition to Executive Chair in June, I'm happy to transition leadership of a business that is in excellent shape to a capable leader who will propel SOPHiA to its next stage of growth. With that, I will now turn the call over to Ross, who will provide a more detailed update on the business and growth drivers for the year.

Thanks, Jurgi. I certainly share your excitement about the business. And today, I'm pleased to share an update on our progress to start the year. In the first quarter, three major themes defined the quarter. First, the U.S. business continues to gain momentum. Decentralized testing has always been a widely accepted characteristic of the European and global market. However, in the last 12 months, demand for decentralized testing has materially increased in the U.S. as reimbursement rates become more established and denial rates improve. Hospitals and labs are waking up to the benefits of scaling their own testing capabilities. Central labs have proven that testing is profitable and that genomic data has significant value. Now U.S. hospitals and labs are making testing part of their core strategy, and those who move are seeing significant benefits. In the first quarter, we announced an expanded partnership with Mount Sinai, one of the leading academic health systems in the U.S., which is using SOPHiA DDM to bring hemato-oncology and solid tumor testing to the New York market. They joined a growing number of New York area institutions to partner with SOPHiA, including NYU Langone Health and Memorial Sloan Kettering Cancer Center. As more institutions adopt SOPHiA DDM, the cost of not having our platform becomes real. Regional density causes patients, providers and even payers to push testing volumes towards sites which offer the best insights at the lowest cost with the fastest turnaround times. We're proud to work with our partners to bring these positive structural changes to the New York testing market and welcome a decentralization revolution to the New York City area. The second key theme for the quarter was continued growth of new applications such as the MSK Impact and MSK Access tests. In Q1, less than two years after decentralizing and deploying these tests globally, we have already reached a total of 100 customers worldwide who have signed on to adopt the applications. A few of these include prestigious Q1 signings such as Master UMC, a leading Dutch academic medical center, Hospitalia Niguarda, one of Italy's leading hospitals in Milan, and a university in Germany. These customers, along with half of the 100 signed accounts, are currently implementing SOPHiA PBM, which means they should begin generating revenue over the next 12 months. Among those who have completed implementation, we are pleased to record 3,000 liquid biopsy analyses in Q1, up more than 100% year-over-year. We look forward to this number continuing to grow as more customers finish their implementation and start using the sophisticated high-sensitivity application. New applications such as liquid biopsy and enhanced exomes help our sales team expand within accounts. As a reminder, we landed a large number of new customers in 2025 with 124 new signings throughout the year. As we turn to 2026, a major focus will be expanding across these customers by encouraging them to adopt additional applications. I'm proud to say that our expand engine is off to a strong start in the first quarter. Net dollar retention, or in other words, same-store growth, increased to 117%, up from 103% in the prior year period. Moreover, forward-looking indicators show no signs of stopping. In Q1, we signed many notable expand deals, including three in Europe that were each valued at over $1 million in annual contract value. This serves as another impressive proof point for the virtuous loop fueling our platform's growth. It also shows that hospitals are excited to consolidate their data strategies with trusted partners in a market where winner-take-most dynamics are forming. The final theme for the quarter was substantial increased momentum with biopharma. In the first quarter, biopharma revenue growth was positive and contributed modestly to overall growth as some of the recent new contracts we signed began to generate revenue. We continue to make progress with a growing number of biopharma partners and momentum is strong. Coming out of AACR and World CDx Summit Europe 2026, it is clear that biopharma customers are looking to develop comprehensive AI investment strategies with trusted partners. It is also clear that every biopharma company we speak to recognizes that SOPHiA provides differentiated value across the drug continuum. They recognize that our diagnostic network is unmatched in global reach and that the data streaming through our platform has incredible value. They also appreciate our deep AI expertise in the field of biology. Our offering is continuing to resonate as one of the only companies in this space that could support a drug across its entire life cycle from companion diagnostics to post-launch monitoring with real-world evidence to patient selection and trial design. In the last six months, increasing momentum has materialized in the recent signing of contracts with major biopharma such as AstraZeneca and Johnson & Johnson as well as biotechs like Kartos and others. Moreover, our partnerships with Myriad Genetics in the U.S. and added innovations in Japan continue to progress as we work on building out the infrastructure for a hybrid global CDx offering. We look forward to updating you more on these items over the coming weeks and months. Looking ahead to the remainder of 2026, our pipeline across clinical and biopharma remains strong and healthy even after strong bookings conversion. Deal size continues to grow and the number of opportunities in our pipeline above $1 million are becoming even more numerous. The market is moving in our direction, and we are excited to continue capitalizing on our opportunity. With that, I will now turn it over to George, who will provide a more detailed look at our financial results and the outlook for 2026.

Thank you, Ross. As Jurgi and Ross highlighted, Q1 results were strong and our outlook remains positive. Total revenue for the first quarter was $21.7 million compared to $17.8 million for the first quarter of 2025, representing year-over-year growth of 22%. I will note that year-over-year revenue growth would have been slightly stronger if not for a one-time benefit in the prior year period from a customer true-up. Platform analysis volume was approximately 108,000 in Q1 compared to 93,000 in the first quarter of 2025, representing solid growth of 16%. From a regional perspective, U.S. volumes continue to expand at healthy levels, growing 28% year-over-year in Q1. APAC also outperformed with 31% volume growth. In EMEA, revenue grew 30% year-over-year, impressively above the company average, mostly driven by great performance in the U.K., Belgium and Switzerland. In Latin America, revenue remains soft, and we have made changes there to turn around our performance. From an application standpoint, Hem/Onc revenue grew 24% year-over-year. Rare and inherited growth also picked up in the quarter with volumes growing over 20% as our enhanced exome product begins to come online. As Ross mentioned, liquid biopsy, which carries a higher average selling price, continues to ramp and contribute to our revenue growth as well with more growth expected for the second half of the year. Core genomic customers were 537 as of March 31, up from 490 in the prior year period. Annualized revenue churn remained world-class at less than 1% in Q1. As Ross mentioned, net dollar retention for the quarter was 117%, up from 103% in the prior year period. Gross profit was $14.7 million compared to $12.2 million in the prior year period, representing growth of 21%. Gross margin was 68.0% compared to 68.7% for the first quarter of 2025. Adjusted gross profit was $16.4 million, an increase of 22% compared to adjusted gross profit of $13.4 million in the prior year period. Adjusted gross margin was 75.4% compared to 75.7% for the first quarter of 2025. Total operating expenses for Q1 were $32.0 million compared to $28.2 million in the prior year period. Some specific items temporarily impacted reported operating expenses and are worth calling out directly as they do not reflect the company's underlying operating performance. First, foreign exchange headwinds continue to negatively impact reported results, primarily due to the strengthening of the Swiss franc. The Swiss franc strengthened approximately 14% against the U.S. dollar from Q1 2025 to Q1 2026, meaningfully increasing the dollar-translated costs of our Swiss payroll and facilities. This is a pure translation effect as our underlying cost structure in local currency remains disciplined. Second, as previously disclosed, Guardant Health filed patent infringement claims against us in the United Kingdom and at the Unified Patent Court in Paris during Q3 last year, alleging that our MSK Access application infringes their patents. We incurred approximately $1.4 million in related legal expenses during Q1, which is reflected as a litigation adjustment in our adjusted EBITDA reconciliation. Importantly, in January, the UPC rejected Guardant's request for provisional measures and ordered them to pay us $700,000 in interim costs, $500,000 of which we received in mid-March and an additional $200,000, which we received in mid-April. Net of this recovery, litigation impact on Q1 operating expenses was approximately $700,000. Operating loss for the first quarter was $17.3 million compared to $16.0 million in the prior year period. Adjusted EBITDA was a loss of $9.2 million compared to the prior year loss of $9.5 million. Lastly, cash burn, which we define as the change in cash and cash equivalents, excluding cash received from borrowings and stock sales as well as FX impacts, was $19.5 million compared to $11.7 million in the prior year period. This year-over-year increase reflects two expected dynamics. First, coming off a strong 2025, annual bonus and commission payouts were meaningfully higher than the prior year, and these were paid in March. Secondly, we also invested in the build-out of a new lab at our Swiss headquarters with increased capacity to support revenue growth for years to come. This impacted our cash burn by approximately $1 million in the quarter. Third, we continue to vigorously defend ourselves against the patent infringement lawsuit filed by Guardant Health, and we paid several bills for expenses incurred in the first quarter of 2025. The $500,000 from Guardant in Q1 and the additional $200,000 received in April only cover a portion of our total litigation costs. We ended Q1 with cash and cash equivalents of $65.4 million as of March 31, which includes $14.5 million in ATM proceeds received in the first quarter of 2026. In January, as previously disclosed, we also expanded our credit facility with Perceptive Advisors, increasing total available liquidity by $25 million. We remain confident in our current capital position with respect to the achievement of our long-term goals. I'll now turn to the 2026 outlook. Given the promising revenue growth in Q1, SOPHiA GENETICS is reaffirming our full year revenue guidance for 2026 of $92 million to $94 million, representing 20% to 22% growth on a reported basis. We still expect 2026 growth to be mostly back half weighted as new business signed in 2025 comes online in the second half of the year and as more MSK Access, MSK Impact Flex and enhanced exome business ramps up to routine usage. We also expect that exchange rates will remain volatile due to macro uncertainties, which may have an impact on reported results. Beyond revenue, we are also reaffirming our full year adjusted EBITDA loss guidance of $29 million to $32 million compared to $41.5 million in full year 2025. As demonstrated this quarter, we continue to make targeted investments in our platform to further optimize cloud compute and storage costs and expect gross margins to slightly expand beyond 2025 levels. As a global company, we are monitoring the ongoing conflict in the Middle East closely, particularly with respect to shipping and customer activity in the region. So far, the conflict has not materially impacted our results, and we do not believe it will have a material impact this year. In Q1, as Jurgi mentioned, we took a series of cost actions and realized benefits of adopting AI across our teams. These actions reinforce our conviction to grow revenue without increasing headcount. They also give us confidence that we will be able to continue holding the line on operating expenses in local currencies and reach our profitability guidance. All said, we continue to believe that we are on track to be approaching adjusted EBITDA breakeven by the end of 2026 and crossing over to positive adjusted EBITDA in the second half of 2027. With that, I would like to turn the call back over to Jurgi for closing remarks before we take your questions.

Thank you, George. As I wrap up my last earnings call as CEO of SOPHiA GENETICS I feel confident as ever in our long-term trajectory. Forward-looking indicators remain strong across the business. We continue to see a steady stream of customer signings across new and existing customers. Biopharma interest is growing and our pipeline is expanding across regions and applications. At the same time, we continue to be laser-focused on optimizing costs and delivering sustainable growth. Thank you to the SOPHiA team, customers, partners and investors for your continued trust and partnership. Fifteen years ago, we had an ambitious vision to transform health care through data and AI. Today, we operate the most widely used AI-driven platform in precision medicine, impacting 40,000 patients per month and 2.5 million patients since inception. I'm so proud of what our team has accomplished over the past 15 years, and I know we are just getting started. Operator, you may now open the line for questions.

Your first question comes from the line of Mark Massaro from BTIG.

Congrats on the quarter. Jurgi, I appreciate the network that you've built globally to decentralize this testing and look forward to working with you as you move to the Executive Chairman role. Moving into my question, I guess, the adjusted gross margin of 75% was certainly a key highlight of this print. Can you just give us a sense, guys, for your degree of confidence to maintain or how do you think about this gross margin profile going forward? I know that you are planning to onboard some higher mix applications. So is this something that you think you can build on here? Or were there some one-time items that might be lumpy on the gross margin line?

So Mark, we've really spent quite a lot of effort modernizing the platform over the past 24 months as we've talked about our Gen 2 transition, and I think you're seeing the benefits of that. And I think there's a lot more scalability left even as we bring on more complex solutions that require a lot more compute. In general, I'm very happy with how the team has executed here. I think fundamentally as well, we're seeing positive pricing dynamics in our environment. So you have both the mix of trade up to more complex solutions as well as more value realized for solutions like ours as a percentage of total cost of diagnostic or as a percentage of revenue. So I think on both of those parameters, this is quite constructive for us. And so I'll let George comment on what's contemplated going forward. But for me, I still think there's some room to go, and certainly, we're very pleased with how we've executed.

Yes. No, Mark, as Ross said, I mean, we're very pleased with the performance of our tech team, and we were pleased with where gross margin came in for the quarter. We do have some pharma business. And if anything could be lumpy on the margin side, it would probably be more of the pharma business. Our full year guidance was modest improvement in gross margins, and we're still holding to that. But certainly, we were pleased with where Q1 came in.

Okay. Great. It looks like you guys took some cost reduction actions in the month of April. It looks like it's a small action, but can you just speak to which regions were impacted? Anything in the U.S. that was material? And how should we think about that in terms of headcount?

So a couple of things, Mark. One, the action was quite small. It was a very modest change to the cost structure. We are an organization very focused on continuing improvement. We've also seen some gains in parts of the business, and so we wanted to be able to reduce some of that and then reinvest in other parts. So in general, this was quite isolated and generally in the G&A functions where we gained efficiency. This was our ability to show that we are an organization very committed to our profitability targets. And also as a software and AI business, we are one that could not only obviously deploy gains to our customers, but also utilize some of that internally in our own operations, which will help us again as we scale and as growth continues to reaccelerate here.

Yes. And again, in our guidance for the year, we said adjusted EBITDA of $29 million to $32 million. This was an important part of maintaining that cost discipline across the organization. As Ross said, that's just part of what we're doing and making sure that we continue to have that discipline going forward. Regionally, most of it was G&A. I would say probably a bit more concentrated in the Swiss operations, but honestly, no real geographic bias to it. The U.S. is where some of the headcount redeployment, particularly on the commercial side, will go. It will be modest. That's because we're seeing really great characteristics in that business and are confident in our ability to continue to grow market share in the territory.

Great. Maybe just my last question. You alluded to the fact that you signed a lot of new customers in 2025, many of which are planning to turn on to the DDM platform in the second half. I just wanted to get a sense for whether or not you believe that you're tracking to initiating the go-lives for many of these customers and wanted to test your degree of confidence on these folks coming on to the platform.

So Mark, we came in ahead of our plan in the first quarter, so we're very happy with our performance. We're conservative, and given it's early in the year, despite the really positive signals we remain cautious. That said, we remain extremely confident in customer onboarding and progression. We want to make sure that we're well set up for the year. Overall, on the onboarding side, I'm really pleased with our implementation team, our tech side and our bioinformatics group as well as our services team. We've seen the pacing of some of the large customers pick up. We have quite a number of them coming online, including some that came on late in March, which helped with that record month that you saw and helped us have a record quarter. My expectation is that that cadence will continue to improve. Many of our AI and other initiatives are focused on speeding up that time to revenue. As George talks about the back half ramp, a good portion of that is highly visible and tied to some of those customers, particularly some of the large U.S. ones coming online, and we remain super confident in our ability to execute on that. If they ramp consistent with what we've seen historically, that may provide some cushion for upside as we tend to initially guide fairly conservatively for the on-ramp of new business. There's a lot to look forward to as that growth continues to move in a favorable direction.

Your next question comes from the line of Dan Brennan from TD Cowen.

This is Kyle on for Dan. I wanted to jump into your net dollar retention, which accelerated again this quarter to 117%. Can you just discuss some of the drivers a little bit more? Is this more driven by customers expanding into multiple applications on DDM? Or is it more a mix of the uptake of higher ASP tests like MSK Access that's driving that performance?

Thanks, Kyle. We're happy to see that metric return to a really high-quality standard among software businesses. The improvement is coming from a mix. We were very intentional this year versus the last two years in focusing on expansion, which benefits net dollar retention. This is a very high ROI acceleration and carries very little incremental cost, which also helps as we think about our shift to EBITDA profitability. Underlying industry trends are healthier as well. Customers are healthy, new technologies are coming online—things like liquid biopsy or exomes for us—and pricing remains favorable. All of those components combined with incredibly low churn give us confidence that the improvement in organic growth rate will sustain.

Got it. Maybe on your Latin America business. You noted it was soft in the first quarter. In your 6-K it said it was down over 30%, but I believe you had a tough comp year-over-year. Can you dig into some of the trends that you're seeing in Latin America and expand upon that a bit?

Thank you. We've been disappointed in that region, albeit it's a small one, but it's strategically important. We made a leadership change there. I was there recently as was our CSO in Brazil, Colombia and Argentina. Brazil at the moment is where some of the softness is isolated. We've got ideas and plans to reaccelerate the territory. I'm optimistic on Mexico and Colombia and to a lesser degree Argentina. We expect the region to return to growth and have taken actions to get back on track. The region is highly pharma-sensitive, so volume can be dependent on pharma pipelines; there are a few key new drugs coming online that will be relevant for Latin America and should help increase testing in some geographies. Overall, we're cautiously optimistic and have taken steps to improve performance.

Your next question comes from the line of Bill Bonello from Craig-Hallum.

A couple of questions here. First, following up on implementation time, more specifically for MSK Access: what are you seeing these days in terms of typical onboarding time once a customer has said they want to adopt MSK Access? And what is a typical ramp once they're up and running the test?

Bill, it's a great question. MSK Access is incredibly important to us. We're proud of the 100 accounts that have come online in less than two years. Adoption rates have varied. Several accounts have come online and oncologists have understood how to utilize the technology, and we've seen volumes ramp. Others take more education. There are varying degrees of sophistication and understanding across different cancer types and regions. About half of the accounts are implementing SOPHiA PBM and they are ramping. We continue to believe this will be a very material part of incremental growth. More is to come over the next several quarters and into 2027. Better oncologist education and the presentations at ASCO and ESMO should help drive utilization to higher levels over time. It's been broadly adopted and you should expect different adoption curves in each nation.

That's helpful. And a follow-up on the pharma side. Typically pharma revenue might capture a lower multiple because it is seen as potentially less recurring. Could you talk about how you think about the pharma business vis-à-vis the clinical business? In other words, how does pharma drive clinical if it does?

Great question. A product like MSK Access, which is really a platform for pharma, has a fantastic flywheel between biopharma and clinical usage. We're pleased with where our pharma business is performing. It's back in the green and starting to show momentum that should accelerate over the next several quarters and into 2027. We made strategic decisions to reduce large one-off project business that doesn't yield recurring benefits and refocused on recurring, repeatable, scalable business. Much of the CDx work we do is done with the intent of serving pharma through approval and then clinically after approval. The idea of one harmonized global solution that doesn't require large bridging studies is compelling. We're already embedded in many accounts, and once we flip the switch from some of the pharma work into the clinical market, it's the same solution and we can start relatively quickly serving customers post-approval. That flywheel is hypercritical and progress in pharma materially improves our overall opportunity. We're not declaring victory, but we are seeing the right trajectory.

Your next question comes from the line of Subu Nambi from Guggenheim Securities.

This is Ricky on for Subu. In the slides, you have the average price per analysis ranging from $100 to $500. For the first quarter, some back-of-the-envelope math puts it around $195 per analysis. What is your expectation for the ASP trend through the remainder of the year? And what are you assuming for this in guidance?

If we exclude the pharma business and just look at the clinical business, our price sequentially was up $2. As Ross said, we're selling more higher-value tests. Our expectation is to continue to see that lift as the quarters go on during the year. We continue to see MSK Access clients—the 100 clients that we booked—ramp up, so we're optimistic about ASP. There's a balance because we are expecting growth in our Latin America business and some emerging markets like India and Turkey, which may put some pressure on ASP. But in terms of modeling, we do expect ASP lift for the remaining quarters of the year.

Thanks. A lot has been asked on biopharma, but did the quarter turn out the way you expected for pharma? Or was it above your expectations? Did this change what you're expecting for the remainder of the year?

We're quite conservative. Pharma performed quite well and we're optimistic for continued sequential improvement and a step-up in the second half of the year. We did not change our expectation in the guide. We're seeing the level of interactions with pharma, the RFPs we're responding to, and what's late stage in the pipeline improve. We've executed new pharma customers and contracts with existing customers, and we're seeing subtle improvements in our evidence generation business. Overall, confidence is up, but we remain conservative in how we factor pharma into the forecast.

We're very pleased with the performance of the pharma business. It's tangible and building momentum. In 2026 it will be an accelerator, but it's likely to be an even larger accelerator in 2027 and beyond as the business continues to build.

There are no further questions. Please continue.

Well, thank you so much for joining us today and for joining me in a journey of 15 years. I'm very happy to hand the driving seat to a fantastic leader who sits next to me here in Switzerland today, surrounded by a very talented team and with a technology that is better than ever to be able to capture even more opportunities in the market. I'm very pleased with what we have achieved, and please continue following us. As you will see, we will continue to transform precision medicine over the next years. Thank you.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.