Natera

Phase A — Understand the business

Lens 1 · Company Overview

Natera is a molecular diagnostics company built on a single platform — cell-free DNA (cfDNA) sequencing married to proprietary bioinformatics/statistical algorithms — pointed at three end-markets: oncology, women's health, and organ health. It reports as one operating segment (molecular testing services), with the CEO as CODM.

The business is, in plain terms, a lab-services razor-and-razor model with a reimbursement engine bolted on: Natera runs blood/tissue samples through its CLIA labs (Austin TX, San Carlos CA; Boulder CO for trials), delivers a result, and bills insurers, Medicare, patients, clinics, or lab-distribution partners. Revenue is recognized per reported unit (a test delivered with a result) under ASC 606, using expected-value estimation of variable consideration — i.e., Natera books revenue at the cash it expects to collect, not list price, because payer reimbursement is the binding constraint.

Key products:

• Signatera — personalized, tumor-informed ctDNA test for molecular residual disease (MRD): recurrence monitoring, treatment-response, immunotherapy response. The growth engine.
• Panorama — non-invasive prenatal test (NIPT) for chromosomal abnormalities. Legacy volume base; available in the US + Europe.
• Horizon — hereditary carrier screening.
• Prospera — organ-transplant rejection assessment (kidney/heart/lung).
• Adjacencies: Latitude (tissue-free CRC MRD), Altera (comprehensive genomic profiling), Empower (hereditary cancer), Fetal Focus/Vistara/Anora (women's health), and Constellation — a cloud/licensing model where partner labs run the wet work and pay to access Natera's algorithms (lower revenue/test, lower cost/test).

Customers/channel: ~96% of revenue runs through Natera's own US direct sales force; ~3% US lab-distribution partners; ~1-2% international. The majority of revenue comes from in-network insurer contracts. No single customer exceeds 10% of revenue; ~14.8% of total revenue is paid by traditional Medicare on behalf of multiple customers. Concentration is therefore in the payer mix (Medicare + a handful of large commercial payers), not in any one buyer.

Key supplier: Illumina — Natera filed the "Eleventh Amendment to Supply Agreement, dated March 2, 2026, by and between the Registrant and Illumina, Inc." as Exhibit 10.1 to the Q1 10-Q. Sequencing reagents/instruments are a single-vendor dependency (see Lens 2).

Lens 2 · Supply Chain

Upstream → Natera → end payer/patient, with named stakeholders:

• Sequencing inputs (the chokepoint): Illumina sequencers + reagents. The 11th amendment to the supply agreement (Mar 2026) signals an ongoing, deepening single-source relationship; the 10-Q's contractual-commitments table shows $136.1M committed to "material suppliers" through Nov 2030 and $16.2M to a "laboratory instruments supplier" through Dec 2027. This is the classic genomics chokepoint — every cfDNA shop (Guardant, Exact, Veracyte, CareDx) sits behind Illumina (or, increasingly, an Illumina/Element/Ultima split). A reagent price hike or allocation event hits Natera's COGS directly.
• Other named commitments: application-service providers $16.4M (to Feb 2034), a cloud-platform provider $20.2M (to Mar 2029 — the Constellation/compute backbone), "other material suppliers" $72.4M. Total contractual commitments $261.4M.
• The labs: Austin TX + San Carlos CA (clinical), Boulder CO (trials, acquired via Foresight). A portion of testing is outsourced to third-party labs.
• Sample acquisition for R&D: Natera buys clinical samples + data for oncology development — paid $15.0M to date with up to $50.0M more contingent on approvals/volume. The data moat is partly bought.
• Downstream: insurers (commercial + traditional Medicare ~15% of rev), patients, clinics, pharma partners (clinical-trial testing), and Constellation lab-licensees.

Chokepoint verdict: the binding external dependency is Illumina sequencing supply; the binding internal dependency is payer reimbursement coverage (Medicare LCDs + commercial contracts), which is really a regulatory/commercial chokepoint, not a physical one. Single-source on the wet side, concentrated-payer on the cash side.

Lens 3 · Competitive Advantages (moats)

Natera's moat is not the sequencer (commodity, rented from Illumina). It is three compounding assets:

1. Reimbursement estate + Medicare coverage breadth. This is the real moat in lab diagnostics. Signatera carries CMS ADLT status (Advanced Diagnostic Laboratory Test) with a fee that entered at $3,500/assay and rose as high as ~$3,920 for CY2025. Signatera holds Medicare coverage across colorectal, breast, ovarian, bladder, lung (surveillance), and pan-cancer immunotherapy monitoring under LCD L38779. Each new covered indication is a one-way ratchet that competitors must re-clear independently — coverage is earned per-indication, per-payer, over years.
2. Tumor-informed data + IP estate. Signatera is bespoke (built from each patient's tumor), which historically out-sensitised tumor-naïve assays. The IP is litigated aggressively (Lens 10/13) — Natera has won injunctions (NeoGenomics RaDaR pulled from market; a 30% ongoing royalty imposed on ArcherDX/Invitae's PCM) but has also seen patents invalidated. The Foresight Diagnostics acquisition ($424.5M, Dec 2025) bought PhasED-Seq phased-variant IP to push sensitivity further.
3. Scale + clinical-evidence flywheel. ~3.5M tests/yr processed in FY2025; a deep trial portfolio (ALTAIR, BESPOKE, SINERGY, CALGB/SWOG 80702) generates the peer-reviewed evidence that drives the next coverage decision. Evidence → coverage → volume → more evidence.

Bargaining power: weak vs. Illumina (single-source upstream); weak-to-moderate vs. large payers (they set reimbursement, and going in-network lowers realized price — management says so explicitly); strong vs. patients/clinicians once a test is standard-of-care and covered. The moat is durable but regulatory, not structural — it can be eroded by a payer policy change or a competitor clearing the same LCD.

Lens 4 · Segments

Natera reports one GAAP segment and does not disclose revenue by oncology/women's-health/organ-health. So a clean segment P&L is n/a — not disclosed. What the filings do give:

• Revenue by type: | FY | Product rev | Licensing/other | Total | YoY | |---|---|---|---|---| | 2023 | $1,068.5M | $14.0M | $1,082.6M | — | | 2024 | $1,685.1M | $11.8M | $1,696.9M | +56.7% | | 2025 | $2,295.8M | $10.3M | $2,306.1M | +35.9% | Product is ~99.5% of revenue; licensing (Constellation) is shrinking in absolute terms (-13% in FY2025) — Natera is not a software-margin story, it's a lab-services story.
• Volume mix (the real segment proxy): total tests processed 2.50M (2023) → 3.06M (2024) → 3.53M (2025). Oncology units 528.2k (2024) → 800.8k (2025), +51.6% — Signatera is the accelerant, growing roughly 1.5x the company average. In Q1 2026, oncology units 258.9k vs 167.7k (+54.4% YoY) while total processed hit ~1.01M in a single quarter for the first time.
• Geography: ~98% US, ~2% international ($41.8M intl in FY2025). Essentially a domestic story; international is a rounding error and an untapped option.

Trend + cause: decelerating percentage growth (56.7% → 35.9%) on a bigger base, but accelerating absolute dollars (+$614M in FY2024, +$609M in FY2025) and an accelerating oncology mix-shift that is raising blended ASP (management cites "average selling price improvements" alongside volume in every period).

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Phase B — Measure performance

Lens 5 · Earnings Result (Q1 2026, reported 2026-05-07)

The print:

• Total revenue $696.6M, +38.8% YoY ($501.8M PY). Product $693.9M (+38.8%); licensing $2.8M. This beat and management raised FY2026 guidance by ~$120M at the midpoint (from $2.62-2.70B to $2.74-2.82B, GM 64-66%).
• Gross margin 64.7% ($450.8M gross profit) vs 63.1% PY — modest expansion.
• Operating loss $(93.5)M (vs $(79.2)M PY) — loss widened in dollars because opex outran revenue: R&D $210.7M (+63.2%) and SG&A $327.9M (+22.9%). R&D is scaling hard (Foresight integration + trial spend).
• Net loss $(85.1)M, EPS $(0.60) vs $(0.50) PY. The print's EPS loss slightly beat consensus.
• The tell — SBC: stock-based comp was $95.1M this quarter alone — larger than the entire operating loss and larger than the net loss. Natera is cash-generative but GAAP-unprofitable purely because of equity dilution (see Lens 10/11).
• Cash flow: operating cash flow +$40.2M (vs +$44.5M PY) despite a $121M AR build (timing — accrued comp + AR seasonality). Capex $22.1M. FCF roughly +$18M for the quarter.
• Balance sheet: $1.09B cash (incl. $150M restricted as UBS collateral), only $80.3M drawn on the UBS credit line (the sole debt), total assets $2.61B, equity $1.77B. Net-cash, effectively unlevered.
• Market reaction: shares rose ~2.2% to ~$216 after-hours — a "beat-and-raise priced-in" reaction, not a gap.

Unusual vs. own history: the $121M AR outflow is large but explained by accrued-compensation timing; nothing smells like a recognition problem. The standout is the R&D step-up (+63%) — management is plowing the Signatera cash engine back into pipeline + Foresight, which is the right call but suppresses near-term operating leverage.

Lens 6 · Earnings Calls (sentiment trend)

No transcripts on the shelf (transcripts=0), so ``. Tone across the last several quarters has been consistently bullish and volume-led: Q4 2025 ~$666M revenue / ~40% growth with "Signatera volumes exceeded consensus, prompting management to raise guidance"; Q1 2026 "revenue jumps 39%, guidance raised". Recurring management themes: oncology/Signatera momentum, new Medicare indications, ASP improvement, gross-margin expansion toward the mid-60s, and pipeline readouts (ALTAIR/SINERGY). One nuance: a 2026 Q1 transcript headline flagged "mixed results; stock drops" intraday — the chew is whether GAAP losses + rising R&D deserve a ~13x sales multiple, even as the top line compounds. What management has effectively stopped emphasising: a hard breakeven date — and analysts have noticed (Lens 11).

Lens 7 · Comps

Molecular-diagnostics / liquid-biopsy peer set. Multiples are ``, as-of dates noted; NTRA EV/Sales is the standout.

P/E, dividend yield, 5-yr avg ROE: n/a — none of these names is GAAP-profitable on a normalized basis; NTRA pays no dividend and ROE is negative (accumulated deficit $2.9B). A P/E table here would be fabrication.

Read: Natera trades at the top of the peer range on EV/Sales (~13x), a premium to Guardant (~11x) and ~2x Exact/Veracyte — justified by the highest growth (+39%) and the MRD-leadership narrative, but it prices in years of flawless execution. The Abbott/Exact deal at ~6.75x is the uncomfortable comp: a profitable strategic acquirer valued the #1 colon-cancer screening franchise at roughly half Natera's sales multiple.

Lens 8 · Stock-Price Catalysts (>5% moves, last ~5 yrs)

Pattern is reimbursement + short-seller + litigation + trial-readout driven, far more than quarterly EPS:

• Mar 2022 — Hindenburg short report: "pioneers in deceptive medical billing." Stock fell ~33% in a day, ~48% peak-to-trough, to ~$36.80. The single biggest move in the name's history — and the genesis of the securities class action (Lens 10).
• Medicare LCD expansions (CRC → bladder → breast → ovarian → lung → IO monitoring, 2021-2026): each coverage win is a step-up catalyst.
• Trial readouts: ALTAIR (CRC, ASCO GI), CALGB/SWOG 80702 (successful Phase III), SINERGY (head & neck, met endpoint) — de-risking the MRD-guided-treatment thesis.
• Guardant $292.5M verdict (Nov 2024) and its July 2025 upholding — litigation overhang catalysts.
• 2026 melt-up: +38% over 52 weeks to ~$231; RBC resumed at Outperform (2026-06-11).

What the market actually reacts to: (1) Medicare/payer coverage decisions, (2) Signatera volume vs. consensus, (3) short-seller/legal headlines, (4) major trial data. Not GAAP EPS — the loss is understood as SBC-driven.

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Phase C — Judge people & books

Lens 9 · Management

• Steve Chapman — CEO (since Jan 2019), President, Director. Joined Natera 2010; rose VP Sales → COO → CEO. Prior: GE Healthcare Life Sciences (head of precision diagnostics) + GE Ventures (2012-2016). UCLA micro/immuno/molecular-genetics. Track record: presided over the revenue ramp from a few hundred million to $2.3B (FY2025) and the Signatera commercialization + reimbursement build — a genuine, quantified operating achievement. Deep reimbursement expertise is exactly the scarce skill this business needs.
• Matthew Rabinowitz, Ph.D. — Co-founder, Executive Chairman (CEO 2005-2019). Built "the highest-volume clinical genetic test in US history" (Panorama) and the Signatera platform; 2x WEF Technology Pioneer, 3x Edison Awards. Founder-led at the board level — strong technical/visionary anchor.
• Michael Brophy — CFO (signs the filings).
• Skin in the game / insider selling: insider-transactions.csv absent, but the 10-Q discloses 10b5-1 plans: Chapman modified a plan for up to 180,643 shares (sales Jun-2026→Mar-2028, much performance-gated); Rabinowitz adopted a plan for up to 100,000 shares (Jun-Dec 2026). Routine, pre-arranged, partly performance-conditioned — not a red flag, but worth tracking given the run-up.
• Capital allocation: historically reinvest-and-dilute — fund the cash gap with equity (SBC + issuance), no buybacks, no dividend. The Foresight deal ($424.5M, all-stock) and Invitae asset purchase show an M&A appetite funded with richly-valued equity — smart while the stock is at 13x sales, dilutive if it de-rates. ROIC is structurally negative (still pre-GAAP-profit); the bet is that today's R&D/coverage spend compounds into tomorrow's operating leverage.
• Archetype: founder-anchored + professional-operator CEO — a healthy pairing for a scaling commercial diagnostics company. Related-party flag: the MyOme investment — exec chairman Rabinowitz is MyOme's chairman/founder/interim-CEO and a ~19.4% holder; co-founder Sheena and CLO Daniel Rabinowitz are also holders; lead independent director Roelof Botha (Sequoia) is connected via Sequoia's MyOme stake. Natera has put $16.7M of capital + warrants worth $20.0M into MyOme. Disclosed and not large, but it is a genuine related-party web around a director-controlled private company — monitor it.

Lens 10 · Forensic Red Flags

Accounting risk map (every figure ):

• Revenue recognition — the #1 area to watch. Natera books revenue at estimated variable consideration (expected cash collections, constrained for refunds) under ASC 606 — i.e., management estimates what insurers will actually pay and recognizes that, before cash arrives. This is inherently judgmental and was the crux of the Hindenburg billing critique. Mitigants: no single customer >10%; the portfolio/expected-value method is standard for the industry; auditor (per 10-K) issued a clean opinion. But a downward reimbursement revision would hit reported revenue directly.
• SBC flatters nothing on GAAP, but masks cash reality. FY2025 SBC $354.4M (Q1 2026 alone $95.1M). The entire GAAP net loss ($208.2M FY2025; $85.1M Q1) is smaller than annual SBC — Natera is FCF-positive but GAAP-loss-making solely because of equity dilution. Share count rose from ~132.6M (Dec-2024) to 142.7M (Mar-2026) — ~7-8%/yr dilution. Non-GAAP/adjusted metrics will look dramatically better than GAAP; insist on per-share, dilution-adjusted analysis.
• One-time tax benefit flatters FY2025. FY2025 net loss of $208.2M includes a $59.9M income-tax benefit — driven by the Foresight deferred-tax-liability recognition releasing valuation allowance. Strip it and the operating loss is $309.9M — the underlying loss is worse than the headline.
• Goodwill/intangibles from Foresight. $141M goodwill + $335.3M developed-technology intangible booked at a 12% discount rate on "forecasted clinical revenue". Aggressive growth assumptions underpin the carrying value; an MRD slowdown could trigger impairment. Contingent consideration up to $175M (fair-valued $118-125M) is re-marked through SG&A every quarter — a $7.2M markup hit SG&A in Q1 2026, adding non-operating noise to opex.
• AR vs. revenue. AR jumped (a $121M Q1 outflow) — partly seasonal/accrual timing, but receivables in a reimbursement-estimate business always warrant watching for collection shortfalls vs. booked estimates. No incremental credit-loss reserve is held against insurance/patient AR (the risk is said to be embedded in the ASP estimate).
• Leases: $204.5M future minimum lease payments, $159.8M lease liability, 7.2-yr WAL — sizable but ordinary for a multi-lab footprint.

Regulatory findings (required sub-section):

• SEC Litigation Releases / AAERs: None. EDGAR EFTS returned 0 LR and 0 AAER for "Natera" since 2021-06-20.
• 10-K Item 3 / Note 10 Legal Proceedings — material and extensive:
• Guardant Health false-advertising verdict — the big one. Nov 2024 jury found Natera liable; damages $292.5M (incl. $175.5M punitive, $75M corrective advertising, $42M disgorgement) over 2021 ads comparing Signatera to Guardant Reveal. In July 2025 the court largely upheld the verdict; Natera plans to appeal to the 9th Circuit. Final judgment not yet entered. This is a real, large, partially-adjudicated contingent liability.
• Securities class action (10b-5): filed W.D. Texas Apr-2022 (post-Hindenburg), alleging false/misleading statements about products/operations. Motion to dismiss granted-in-part/denied-in-part; the class has been certified — it is live and advancing. Plus two shareholder derivative suits (Oct-2023, Jan-2024).
• Patient/consumer class actions: multiple over billing practices and Panorama marketing and PGT-A — several settled/in-settlement, some dismissed-without-prejudice then re-amended.
• IP litigation web (Natera usually the aggressor): wins — NeoGenomics RaDaR enjoined/withdrawn; ArcherDX/Invitae 30% ongoing royalty + ~$1.23M supplemental damages (Apr 2026); losses — several Natera patents invalidated (CareDx Patent Cases, Ravgen $57M against Natera on non-willful infringement with judgment not yet entered). LabCorp/Invitae matter settled Sep-2025.
• Aggregate legal accrual: ~$33.0M (Mar-2026), and management states it cannot estimate the range of loss above accruals for the major matters. The $292.5M Guardant exposure is not fully reserved.
• Non-SEC enforcement (web): the 2022 Hindenburg report alleged deceptive billing/possible insurance-fraud patterns; Natera disputed it. No disclosed FTC/DOJ/CMS enforcement settlement surfaced in search, but the consumer-billing class actions are the civil echo of those allegations.

Net forensic read: the books are clean enough (no SEC actions, clean audit, standard-but-judgmental revenue method) — but the litigation tail is unusually heavy (a $292.5M verdict on appeal + a certified securities class action), the GAAP loss is cosmetically worse than the SBC-masked cash reality, and a one-time tax benefit flattered FY2025. Quality-of-earnings: cash-positive and real, but read non-GAAP claims with the dilution in hand.

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Phase D — Project & stress-test

Lens 11 · Forward Projection (FY2026 / FY2027 / FY2028)

Built bottom-up from the latest actuals + raised guidance. Revenue is well-anchored; EPS is the contested variable.

Revenue:

• FY2026: ~$2.78B — company guide $2.74-2.82B; consensus $2.77B (18 analysts). ≈ +20% YoY. ``
• FY2027: ~$3.3B — consensus implies similar (analysts model ~20% 3-yr revenue CAGR ).
• FY2028: ~$3.9-4.0B.

EPS — the honest part: n/a as a positive number. Natera is GAAP-loss-making and consensus does NOT model breakeven in the forecast horizon. The 18-analyst consensus is FY2026 EPS ≈ $(1.69) and FY2027 ≈ a ~$8.25M net loss (essentially flat-to-slightly-negative) — and "analysts no longer expect the company to break even during the foreseeable future". The bridge to cash profitability already exists (TTM FCF +$104.5M ); the bridge to GAAP profitability is gated on SBC moderating relative to a growing revenue base.

• Base case: revenue compounds high-teens/low-20s; gross margin holds 64-66%; FCF stays positive and grows; GAAP net loss persists (~$(1.50)-$(1.70) EPS in FY2026) as R&D + SBC stay elevated; the stock is driven by revenue/coverage, not earnings.
• Bull case: oncology mix-shift + new Medicare indications push ASP and revenue to the high end ($2.82B+ FY2026, ~$3.5B FY2027); operating leverage finally appears as SG&A growth (+23%) lags revenue (+39%); FCF inflects toward $250M+; the market re-rates the path to GAAP profit.
• Bear case: a payer reimbursement cut (microdeletions precedent), a competitive MRD share-loss to Guardant/Tempus, or the Guardant $292.5M judgment crystallizing — revenue decelerates to ~10-12%, the 13x multiple compresses toward Exact's 6.75x, and the equity halves on multiple alone.

Brier forecast (logged conceptually; not committed via forecast.ts in --watchlist): "NTRA FY2027 GAAP EPS ≥ $0.00 (breakeven)" — p ≈ 0.20 (consensus says no; bet against breakeven). The more useful tracked binary: "NTRA FY2026 revenue ≥ $2.80B" — p ≈ 0.55 (top half of guide, given the beat-and-raise cadence).

Lens 12 · Bull vs Bear

Bull case. Natera owns the leading tumor-informed MRD franchise in a market estimated at $20B+ TAM growing ~30%/yr and <10% penetrated. Signatera is compounding ~50%+ with the broadest Medicare coverage in MRD (6 cancer types + IO monitoring) and ADLT pricing of $3,500-3,920 — a reimbursement moat rivals must re-clear indication-by-indication. The platform throws off positive free cash flow on a net-cash balance sheet ($847M), so it funds its own pipeline. Trial readouts (ALTAIR/SINERGY/CALGB-SWOG) are moving MRD from "monitoring" to "treatment-guiding," which expands the billable population. Optionality: women's-health/organ-health are mature cash cows subsidizing the oncology land-grab; international is untapped; the Abbott/Exact deal proves strategics will pay up for category leaders — Natera is the most obvious next consolidation prize.

Bear case (permanent-impairment risks). (1) Reimbursement is the whole moat and it cuts both ways — Natera itself flags that going in-network lowers realized price, and Medicare has previously declined coverage (microdeletions); a single adverse LCD or a CMS ADLT re-pricing could reset the model. (2) The multiple is the risk. ~13x sales for a GAAP-unprofitable company with no consensus breakeven in sight prices perfection; the Abbott/Exact comp at ~6.75x is a ~2x de-rate waiting to happen if growth slips. (3) Litigation tail — the $292.5M Guardant verdict (only ~$33M reserved) plus a certified securities class action are real, large, and only partly adjudicated. Pre-mortem (18 months out, thesis broke): Medicare trims MRD reimbursement OR a competitor (Guardant Reveal, Tempus, NeoGenomics RaDaR-ST) clears the same indications and compresses ASP; oncology growth decelerates from 50% to 25%; the 9th Circuit affirms Guardant; the stock re-rates from 13x to 7x sales and halves — with the business still growing. Contrarian view the market refuses to see: the bull and bear are both about the top line — almost nobody is underwriting the dilution drag (7-8%/yr share growth, $354M/yr SBC) that means even a doubling of revenue may not produce the GAAP earnings the multiple implicitly demands.

Multiple assessment: too high on any earnings-based frame, defensible only on growth-adjusted EV/Sales — and only if ~20% growth holds for 3+ years. Asymmetry skews to the downside from here.

Lens 13 · Devil's Advocate (short-seller)

Dismantling the bull case. Where revenue is concentrated: in payer reimbursement policy — ~15% of revenue is traditional Medicare, and the recognized number is an estimate of insurer collections, not contracted cash. What breaks it: (a) a CMS or large-commercial coverage/price reset — the microdeletions denial is the precedent that it can happen; (b) Natera books revenue on expected-value estimates that the same short thesis (Hindenburg 2022) called "deceptive billing" — a certified securities class action is now litigating exactly that. The moat is weaker than bulls think because it's rented twice: the sequencing is single-source Illumina (no cost moat), and the reimbursement is granted by payers who are actively trying to curb molecular-test spend. Most dangerous competitor bulls underestimate: not Guardant (the courtroom rival) but Tempus AI (data-scale + AI narrative) and a post-Abbott Exact Sciences — Abbott's distribution + balance sheet behind a colon-cancer franchise could subsidize MRD entry and crush ASP. Worst capital-allocation/governance items: the MyOme related-party web (exec chairman controls the counterparty), $354M/yr SBC diluting holders ~8%/yr, and an all-stock M&A habit that only works while the stock is expensive. Assumptions that must hold for today's price: ~20% revenue CAGR for 3+ years, no reimbursement cut, no large litigation cash-out, and eventual operating leverage despite a +63% R&D quarter. If growth disappoints 20-30% (say FY2026 lands $2.4B not $2.8B): the 13x multiple is indefensible, mean-reversion toward 6-7x sales halves-to-thirds the equity. Single permanent-impairment scenario: a standard-of-care MRD reimbursement downgrade (CMS narrows LCDs or cuts the ADLT rate) — moderately plausible given payer cost-pressure, and it would hit both revenue and the multiple simultaneously.

Lens 14 · Management Questions (ordered by information value)

1. What is your realistic GAAP-breakeven year, and what SBC-as-%-of-revenue trajectory gets you there — given consensus now models no breakeven in the forecast horizon?
2. On the $292.5M Guardant verdict: what is your probability-weighted cash exposure post-appeal, why is only ~$33M accrued, and what's the worst-case 9th-Circuit outcome?
3. Signatera ASP — what was blended realized price per oncology unit in FY2025, and how much of revenue growth is volume vs. price as ADLT pricing matures?
4. What is your dependence on Illumina post-11th-amendment — pricing terms, alternative sequencers qualified (Element/Ultima), and the COGS sensitivity to a reagent price change?
5. Which Medicare LCD is most at risk of narrowing or re-pricing, and what % of revenue rides on the single most-exposed coverage decision?
6. Define the oncology TAM you can actually bill (covered indications × realized ASP × penetration) vs. the headline "$20B MRD market."
7. Foresight developed-technology intangible ($335M at a 12% discount rate): what clinical-revenue ramp underpins it, and what would trigger impairment?
8. MyOme — given the executive-chairman control and Sequoia ties, why is this the right use of Natera capital, and what governance ring-fence protects minority holders?
9. How do you defend MRD share against a post-Abbott Exact Sciences and against Tempus/Guardant on price as the field commoditizes?
10. Capital allocation: at ~13x sales, is all-stock M&A still your preferred currency, and at what valuation would you switch to buybacks?
11. International is ~2% of revenue — is that a strategic choice or a capability gap, and what's the 5-year mix target?
12. The certified securities class action: what is the financial-statement risk, and what changed in disclosure controls since 2022?
13. Women's-health/organ-health — are these managed-for-cash to fund oncology, and what's the reinvestment split?
14. With R&D +63% YoY, what specific programs is that funding and what ROIC hurdle do you apply to trial spend?
15. What single operating metric should investors track to know the operating-leverage inflection has actually begun?

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