Natera Reports First Quarter 2025 Financial Results

Natera Reports First Quarter 2025

AUSTIN, Texas, May 8, 2025 /PRNewswire/ - Natera, Inc.

(NASDAQ: NTRA), a global leader in cell-free DNA and precision medicine, today reported

its financial results for the first quarter ended March 31, 2025.

Recent Strategic and Financial Highlights

"We delivered another strong quarter, with

volume growth across the business, including a record growth quarter for Signatera," said Steve Chapman, chief executive officer

of Natera. "Our progress reflects the strength of our technology and the breadth and quality of the clinical data. With multiple

high-impact datasets reading out and trials underway, we believe we're in a strong position to help millions of patients in the

First Quarter Ended March 31, 2025 Financial

Total revenues were $501.8 million in the first

quarter of 2025 compared to $367.7 million in the first quarter of 2024, an increase of 36.5%. The increase in total revenues was driven

primarily by a 37.1% increase in product revenues, which were $500.0 million in the first quarter of 2025 compared to $364.7 million in

the first quarter of 2024. The increase in product revenues was primarily driven by an increase in volume and average selling price improvements,

as well as cash receipts that were collected during the quarter in excess of initial revenue estimates for tests delivered in prior quarters.

Natera processed approximately 855,100 tests

in the first quarter of 2025, including approximately 840,800 tests accessioned in its laboratory, compared to approximately 735,800

tests processed, including approximately 718,700 tests accessioned in its laboratory, in the first quarter of 2024, an increase of 16.2%

from the prior period.

In the first quarter of 2025, Natera recognized

revenue on approximately 804,800 tests for which results were reported to customers in the period (tests reported), including approximately

791,400 tests reported from its laboratory, compared to approximately 679,400 tests reported, including approximately 663,500 tests reported

from its laboratory, in the first quarter of 2024, an increase of 18.5% from the prior period.

Gross profit2 for the three months

ended March 31, 2025 and 2024 was $316.8 million and $208.6 million, respectively, representing a gross margin of 63.1% and 56.7%,

respectively. Natera had higher gross margin in the first quarter of 2025 primarily as a result of higher revenues, continued progress

in reducing cost of revenues associated with tests processed, as well as incremental cash receipts during the quarter in excess of initial

revenue estimates for tests delivered in the prior period. Total operating expenses, representing research and development expenses and

selling, general and administrative expenses, for the first quarter of 2025 were $395.9 million, compared to $282.9 million in the same

period of the prior year, an increase of 39.9%. The increase was primarily driven by headcount growth to support new product offerings

as well as increases in consulting and legal expenses.

Loss from operations for the first quarter of

2025 was $79.2 million compared to $74.3 million for the same period of the prior year.

Natera reported a net loss for the first quarter

of 2025 of $66.9 million, or ($0.50) per diluted share, compared to a net loss of $67.6 million, or ($0.56) per diluted share, for the

same period in 2024. Weighted average shares outstanding were approximately 134.8 million in the first quarter of 2025 compared to 120.8

million in the first quarter of the prior year.

At March 31, 2025, Natera held approximately

$991.6 million in cash, cash equivalents, short-term investments and restricted cash, compared to $968.3 million as of December 31,

2024. As of March 31, 2025, Natera had a total outstanding debt balance of $80.3 million including accrued interest under its line

of credit with UBS at a variable interest rate of 30-day SOFR plus 50 bps.

Natera anticipates 2025 total revenue of $1.94

billion to $2.02 billion; 2025 gross margin to be approximately 60% to 64% of revenues; selling, general and administrative costs to

be approximately $0.975 billion to $1.05 billion; research and development costs to be $550 million to $590 million; and net cash inflow

is a global leader in cell-free DNA and genetic testing, dedicated to oncology, women's health, and organ health. We aim to make

personalized genetic testing and diagnostics part of the standard of care to protect health and enable earlier, more targeted interventions

that help lead to longer, healthier lives. Natera's tests are validated by more than 250 peer-reviewed publications that demonstrate

high accuracy. Natera operates ISO 13485-certified and CAP-accredited laboratories certified under the Clinical Laboratory Improvement

Amendments (CLIA) in Austin, Texas and San Carlos, California. For more information, visit www.natera.com.

Conference Call Information

Forward-Looking Statements

This press release contains forward-looking statements

under the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts, including

statements regarding its market opportunity, anticipated products and launch schedules, reimbursement coverage and product costs, commercial

and strategic partnerships and acquisitions, user experience, clinical trials and studies, and its strategies, goals and general business

and market conditions, are forward-looking statements. Any forward-looking statements contained in this press release are based upon Natera's

current plans, estimates, and expectations, as of the date of this release, and are not a representation that such plans, estimates, or

expectations will be achieved.

These forward-looking statements are subject to

known and unknown risks and uncertainties that may cause actual results to differ materially, including: we face numerous uncertainties

and challenges in achieving our financial projections and goals; we may be unable to further increase the use and adoption of our products

through our direct sales efforts or through our laboratory partners; we have incurred net losses since our inception and we anticipate

that we will continue to incur net losses for the foreseeable future; our quarterly results may fluctuate from period to period; our estimates

of market opportunity and forecasts of market growth may prove to be inaccurate; we may be unable to compete successfully with existing

or future products or services offered by our competitors; we may engage in acquisitions, dispositions or other strategic transactions

that may not achieve our anticipated benefits and could otherwise disrupt our business, cause dilution to our stockholders or reduce our

financial resources; our products may not perform as expected; the results of our clinical studies may not support the use and reimbursement

of our tests, particularly for microdeletions screening, and may not be able to be replicated in later studies required for regulatory

approvals or clearances; if either of our primary CLIA-certified laboratories becomes inoperable, we will be unable to perform our tests

and our business will be harmed; we rely on a limited number of suppliers or, in some cases, single suppliers, for some of our laboratory

instruments and materials and may not be able to find replacements or immediately transition to alternative suppliers; if we are unable

to successfully scale our operations, our business could suffer; the marketing, sale, and use of Panorama and our other products could

result in substantial damages arising from product liability or professional liability claims that exceed our resources; we may be unable

to expand, obtain or maintain third-party payer coverage and reimbursement for our tests, and we may be required to refund reimbursements

already received; third-party payers may withdraw coverage or provide lower levels of reimbursement due to changing policies, billing

complexities or other factors; we could incur substantial costs and delays complying with governmental regulations, including recently

enacted FDA regulations regarding LDTs; litigation and other regulatory or governmental proceedings, related to our intellectual property

or the commercialization of our tests, are costly, time- consuming, could result in our obligation to pay material judgments or incur

material settlement costs, and could limit our ability to commercialize our tests; and any inability to effectively protect our proprietary

technology could harm our competitive position or our brand..

We discuss these and other risks and uncertainties

in greater detail in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial

Condition and Results of Operations" in our periodic reports on Forms 10-K and 10-Q and in other filings that we make with the SEC

from time to time. These documents are available on our website at www.natera.com under the Investor Relations section and on the SEC's

website at www.sec.gov.

We operate in a very competitive and rapidly changing

environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact

of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially

from those contained in any forward-looking statement. In light of these risks, uncertainties and assumptions, you should not place

undue reliance on our forward-looking statements. Except as required by law, we undertake no obligation to update publicly any forward-looking

statements for any reason after the date of this presentation to conform these statements to actual results or to changes in our expectations.

Mike Brophy, CFO, Natera, Inc., investor@natera.com

Lesley Bogdanow, VP of Corporate Communications, Natera, Inc., pr@natera.com

Consolidated Balance Sheets

(in thousands, except shares)

Consolidated Statements of Operations and Comprehensive

(in thousands, except per share data)