NantHealth Reports 76% Increase In Total Q3 Net Revenue 2016 Vs 2015, Gross Profit Triples

NantHealth, Inc. (NASDAQ-GS: NH), a next-generation, evidence-based, personalized healthcare company, today reported financial results for its third quarter ended September 30, 2016.

For the 2016 third quarter, total net revenue increased 76% to $25.4 million from $14.4 million in last year's third quarter. Gross profit more than tripled to $8.1 million, from $2.3 million, for the 2015 third quarter. Selling, general and administrative (SG&A) expenses were $24.7 million compared with $18.1 million for the prior year third quarter. Research and development (R&D) expenses increased to $13.9 million from $7.0 million in the comparable quarter of last year.

Net loss for the 2016 third quarter was $36.9 million, or $0.30 per share, compared with $23.0 million, or $0.24 per share, for the 2015 third quarter. Financial results for the 2016 third quarter included approximately $5.5 million of intangible amortization and $5.2 million in non-cash, stock-based compensation expense, equal to $0.10 per share. On a non-GAAP basis, for the 2016 third quarter, adjusted net loss was $22.4 million, or $0.18 per share, compared with $18.2 million, or $0.17 per share, in the prior year third quarter.

"The significant increase of total net revenue was primarily driven by a 252% increase in SaaS revenue," said Patrick Soon-Shiong, M.D., chief executive officer and chairman of NantHealth. "We continue to make great strides in healthcare interoperability and connectivity. With regard to our GPS Cancer Test, education in the oncology community is progressing rapidly. As the oncologists begin to understand that this test better informs them and their patients as to the biology of the cancer and which drugs may or may not be effective based on the genomics and proteomics signature, adoption is progressing as evidenced by the over 100% increase in number of oncologists ordering the test. We are gratified to experience this response since we believe the test is as important to guide the physician as to which drugs not to administer as well as which agents may show sensitivity. The opportunity to have this information on hand before treatment begins is having an impact on physicians' acceptance of the value that this test can bring to cancer care. The challenge and opportunity remains, our need to continue this educational process both with provider and payer. We have ramped up our efforts to educate oncologists in target markets, secured new payer coverage and streamlined IT implementations."

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