NEW HAVEN, Conn., Aug. 13, 2025 (GLOBE NEWSWIRE) -- Specialty cancer diagnostics company Precipio, Inc. (NASDAQ:PRPO), filed its 10-Q report today. The following are the highlights of the Company's financial performance and outlook for 2025.

"Yet another quarter of revenue growth in both company divisions, along with overall gross margin improvement, has led to an improved cash performance for the Company. With the remaining repayment of the Change Healthcare loan to be completed by the end of the year, and continued strength in both revenue and margin growth, management believes that the Company is on track to end the year as a cash flow positive business, and with a debt-free, strong balance sheet," said Ilan Danieli, Precipio's CEO.

Q2-2025 Financial Results:

Revenues. Q2-2025 revenues reached $5.7M, representing a 27% increase YoY from $4.4M in Q2-2024, and a QoQ increase of 15% from Q1-2025. Pathology services revenue increased 18% from the prior quarter. Revenues from Product customers increased 23% from the prior quarter (this comparison excludes fees of $145K in Q1-2025 from a special project with a pharmaceutical company).
Adjusted EBITDA. Q2-2025 Adjusted EBITDA was ($78K) vs ($609K) YoY, a significant improvement of 87% resulting from both revenue growth and cost management initiatives.
Cash flow. Cash used by operations (net of Change Healthcare transactions and the Covid-related Employee Retention Credit) decreased from $516K in Q2-2024, to $148K in Q2-2025, an improvement of 71% YoY.

Products Division Summary:

We are seeing clear momentum in our products division, driven by continued progress with our distributor network and a growing pipeline of customers at various stages of the sales and onboarding process. Product revenues demonstrated a strong rebound this quarter, fueled by the return of two customers to full operational volume and the onboarding of a new customer.

Additional revenue growth came organically from existing customers who expanded their test offerings by adding new HemeScreen panels, reinforcing both the value of our platform and the scalability of our product portfolio.

Pathology Services Division Summary:

Pathology Services revenue increased by approximately $0.75M, or 17% from $4.25M in Q1-2025 to $5.0M in Q2-2025. This growth was achieved through organic growth and the efforts of our existing sales team, via both the acquisition of several new customers, and increased volume coming from existing customers. We do not anticipate any substantial capital expenditures required to continue to support this growth, nor any significant additions to the laboratory staff. With laboratory operations well below capacity, this continued growth represents direct contribution to increased margins and cash generated by the operation.

Gross margins, operating expenses:

Gross margin analysis:

Product's division gross margins YoY were 44% in Q2-2025 and 50% in Q2-2024. This decline of 6% is due to a number of factors: First, a recent increase in rent expense following the Company's expansion into a larger space to support future growth. Management views this as a strategic investment in scaling operations and expects margins to improve as revenue continues to grow and fixed costs are absorbed more efficiently. Second, an increase in depreciation expense due to the purchase of manufacturing-related equipment. These capital expenditures are aligned with our long-term strategy to enhance production capacity, improve operational efficiency, and support the anticipated growth of our Products division. Moreover, Product economics are highly scalable; for example, an increase of less than $100,000 in product revenue will increase gross margins by over 6%, returning to prior quarter margin level.
Pathology Services division gross margins have increased YoY from 37% to 43%, The margin increase is due to increased case volume this quarter, as well as improved case mix towards more profitable tests run in our lab
Overall, the Company's gross margin has increased YoY from 39% to 43%.

EBITDA and Adjusted EBITDA Reconciliation and Explanation

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is a non-GAAP financial measure that is widely used to evaluate operational performance. Management believes Adjusted EBITDA provides investors with a useful perspective on the company's ongoing financial health, by also eliminating (a) unusual non-operating income and expense and (b) non-cash charges for employee stock option costs.

Below is a reconciliation of Net Income, EBITDA and Adjusted EBITDA for the second quarter of 2025 and 2024:

($ in millions, Unaudited)	Q2-2025	Q2-2024
Net income/(loss) (GAAP)	$0.1	$(1.2)
Adjustments to net income/(loss):
Interest expense, net	$0	$0
Income taxes	$0	$0
Depreciation	$0.1	$0.1
Amortization of intangibles	$0.2	$0.2
EBITDA (non-GAAP)	$0.4	$(0.9)
Further Adjustments to EBITDA:
Stock-based compensation expense	$0.4	$0.3
Other non-operating (income) expenses, net	$(0.9)	$0
Adjusted EBITDA (non-GAAP)	$(0.1)	$(0.6)

Note: The full unaudited condensed consolidated financial statements, including the balance sheet and statement of cash flows as of and for the three and six months ended June 30, 2025 and 2024, are included in the Company's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on or before August 14, 2025, which is available on the SEC's website at www.sec.gov and on the Company's investor relations website.

Shareholder Conference Call:

At 5:00 pm ET on August 14, 2025, the Company will host its quarterly shareholder call where management will provide more details as to the Company's quarterly performance and outlook going forward. Please join us by dialing in at 800.717.1738.

About Precipio

Precipio is a healthcare biotechnology company focused on cancer diagnostics. Our mission is to address the pervasive problem of cancer misdiagnoses by developing solutions in the form of diagnostic products and services. Our products and services deliver higher accuracy, improved laboratory workflow, and ultimately better patient outcomes, which reduce healthcare expenses. Precipio develops innovative technologies in our laboratory where we design, test, validate, and use these products clinically, improving diagnostic outcomes. Precipio then commercializes these technologies as proprietary products that serve the global laboratory community and further scales Precipio's reach to eradicate misdiagnosis.

Availability of Other Information About Precipio

For more information, please visit the Precipio website at https://www.precipiodx.com/ or follow Precipio on X (formerly Twitter) (@PrecipioDx) and LinkedIn (Precipio) and on Facebook. Investors and others should note that we communicate with our investors and the public using our company website (https://www.precipiodx.com), including, but not limited to, company disclosures, investor presentations and FAQs, Securities and Exchange Commission filings, press releases, public conference call transcripts and webcast transcripts, as well as on X and LinkedIn. The information that we post on our website or on X or LinkedIn could be deemed to be material information. As a result, we encourage investors, the media and others interested to review the information that we post there on a regular basis. The contents of our website or social media shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding the targets set herein and related timing. Except for historical information, statements about future volumes, sales, growth, costs, cost savings, margins, earnings, earnings per share, diluted earnings per share, cash flows, adjusted EBITDA, plans, objectives, expectations, growth or profitability and our potential to reach financial independence are forward-looking statements based on management's estimates, beliefs, assumptions and projections. Words such as "could," "may," "expects," "anticipates," "will," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," "predicts," and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic and financial performance, are intended to identify such forward-looking statements. These forward-looking statements are only predictions based on management's current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the important factors discussed under the caption "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and our other reports filed with the U.S. Securities and Exchange Commission. Any such forward-looking statements represent management's estimates as of the date of this press release only. While we may elect to update such forward-looking statements at some point in the future, except as required by law, we disclaim any obligation to do so, even if subsequent events cause our views to change. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

Inquiries:

investors@precipiodx.com

+1-203-787-7888 Ext. 523

Precipio Announces its Q2-2025 Financial Results