On May 23, 2024, 23andMe Holding Co (ME, Financial) released its 8-K filing detailing the financial results for the fourth quarter and full fiscal year 2024, which ended on March 31, 2024. 23andMe Holding Co is a consumer-facing healthcare technology company, primarily involved in the sale of direct-to-consumer personal genome services (PGS) through DNA collection kits shipped via mail. The company provides users access to reports summarizing estimated genetic ancestry breakdown, phenotypic trait reports, and various health predisposition and disease carrier reports. Its segments include Consumer and Research Services and Therapeutics, with the majority of revenue generated from the Consumer and Research Services segment.
Performance Overview
For the fourth quarter of fiscal 2024, 23andMe reported total revenue of $64.0 million, a significant decrease of approximately 31% compared to $92.4 million in the same period of the prior year. This decline was primarily attributed to lower research revenue following the conclusion of the GSK collaboration exclusivity term in July 2023, as well as reduced PGS kit volumes and telehealth orders. Full-year revenue for fiscal 2024 was $219.6 million, down from $299.5 million in fiscal 2023, representing a 27% decrease.
Financial Achievements and Challenges
Despite the revenue decline, 23andMe made notable advancements in its product offerings and clinical trials. The company launched the 23andMe+ Premium ancestry feature called Historical Matches and introduced new genetic reports for breast, colorectal, and prostate cancer. Additionally, the company dosed the first patient for its Phase 1 clinical trial for 23ME-01473, a dual-mechanism natural killer (NK) cell activator targeting ULBP6, intended to treat cancer.
However, the company faced significant challenges, including a substantial increase in operating expenses, which rose to $239 million in Q4 FY24 from $109 million in the same period the previous year. This increase was primarily due to a $153 million non-cash goodwill impairment charge. Consequently, the net loss for Q4 FY24 was $209 million, compared to a net loss of $64 million in Q4 FY23.
Key Financial Metrics
| Metric | Q4 FY24 | Q4 FY23 | FY24 | FY23 |
|---|---|---|---|---|
| Total Revenue | $64.0 million | $92.4 million | $219.6 million | $299.5 million |
| Net Loss | $(209) million | $(64) million | $(667) million | $(312) million |
| Adjusted EBITDA | $(33) million | $(39) million | $(176) million | $(161) million |
Balance Sheet and Cash Flow
As of March 31, 2024, 23andMe reported cash and cash equivalents of $216 million, down from $387 million as of March 31, 2023. The company’s total assets decreased to $395 million from $943 million in the previous year, reflecting the impact of the goodwill impairment charges and other financial adjustments.
Strategic Review and Future Outlook
On March 28, 2024, the Board of Directors of 23andMe formed a Special Committee to review strategic alternatives to maximize shareholder value. Subsequently, on April 18, 2024, it was announced that Anne Wojcicki, CEO and Co-Founder, is considering a proposal to acquire all outstanding shares of 23andMe that she does not currently own. The company has also received an extension from Nasdaq until November 4, 2024, to regain compliance with the minimum bid price requirement for continued listing.
"The Company had a productive fourth quarter and solid end to the year, continuing to add value for members of 23andMe+ and advancing our clinical stage assets," said Anne Wojcicki, Co-Founder & CEO of 23andMe. "We continue to work to build value for customers and shareholders and are looking forward to a transformative FY2025."
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from 23andMe Holding Co for further details.
