Personalis, Inc.

Previous wording

We are working with a growing number of leading cancer centers and world-class academic research institutions to build and publish the clinical evidence-base to support our products and our key indications, as well as to obtain reimbursement coverage from Medicare and other payors. Because of the ultra-high analytical sensitivity of our technology, we are primarily focusing on three indications: breast cancer, lung cancer, and immunotherapy (IO) monitoring. We have collaborations with Cancer Research UK, University College London, and the Francis Crick Institute (the TRACERx study); Institut Curie; The Royal Marsden; the Vall d'Hebron Institute of Oncology (VHIO); the University of California, San Diego; Duke University; Vanderbilt University and Johns Hopkins University (the PREDICT study); the Dana-Farber Cancer Institute; the University of Texas M.D. Anderson Cancer Center; University Medical Center Hamburg-Eppendorf (also known as UKE); and Criterium and the Academic Breast Cancer Consortium, that will focus on building the evidence-base for our technology and these indications.

Current wording

We are working with a growing number of leading cancer centers and world-class academic research institutions to build and publish the clinical evidence-base to support our products and our key indications, as well as to obtain reimbursement coverage from Medicare and other payors. Because of the ultra-high analytical sensitivity of our technology, we are initially focusing on three indications: breast cancer, lung cancer, and immunotherapy (IO) monitoring. We have collaborations with Cancer Research UK, University College London, and the Francis Crick Institute (the TRACERx study); Institut Curie; The Royal Marsden; the Vall d'Hebron Institute of Oncology (VHIO); the University of California, San Diego; Duke University; Vanderbilt University and Johns Hopkins University (the PREDICT study); the Dana-Farber Cancer Institute; the University of Texas M.D. Anderson Cancer Center; University Medical Center Hamburg-Eppendorf (also known as UKE); and Criterium and the Academic Breast Cancer Consortium, that will focus on building the evidence-base for our technology and these indications.

Previous wording

Our work in oncology is underpinned by our experience and capacity for next-generation sequencing at scale. We have the capacity to sequence and analyze over 350 trillion bases of DNA per week in our facility. We believe that our capacity is already larger than most cancer genomics companies, and we continue to build automation and other infrastructure to scale further as demand increases. To date, we have sequenced approximately 500,000 human samples, of which approximately 200,000 were whole human genomes.

Current wording

Our work in oncology is underpinned by our experience and capacity for next-generation sequencing at scale. We have the capacity to sequence and analyze over 350 trillion bases of DNA per week in our facility. We believe that our capacity is already larger than most cancer genomics companies, and we continue to build automation and other infrastructure to scale further as demand increases. To date, we have sequenced approximately 552,000 human samples, of which approximately 206,000 were whole human genomes.

Previous wording

Total revenue decreased $5.4 million, or 24%, during the second quarter of 2025 compared to the second quarter of 2024, primarily due to the expected decline of $5.6 million in revenue from Natera, and a decrease in revenue from pharma tests and services, and other customers of $2.1 million, partially offset by an increase in population sequencing revenue of $2.0 million.

Current wording

Total revenue of $14.5 million decreased $11.2 million, or 44%, during the third quarter of 2025 compared to the third quarter of 2024, primarily due to the expected decline of $4.6 million in revenue from Natera, the expected decrease in population sequencing revenue of $4.2 million, and a decrease in revenue from pharma tests and services, and other customers of $2.5 million.

Previous wording

Key business accomplishments and financial updates in the second quarter of 2025 include:

Current wording

Key business accomplishments and financial updates in the third quarter of 2025 include:

Previous wording

Clinical Adoption Acceleration: Delivered 3,478 clinical tests in the second quarter of 2025, a 59% sequential increase over Q1 2025,demonstrating accelerating physician adoption of the NeXT Personal platform

Current wording

Accelerated Clinical Adoption: Delivered 4,388 clinical tests, demonstrating robust 26% sequential increase over the second quarter of 2025 and a 364% year-over-year growth fueled by increasing physician adoption of the NeXT Personal platform for cancer monitoring

Previous wording

Other income (expense), net includes foreign currency exchange gains and losses. Other income (expense), net during the three and six months ended June 30, 2024 consisted primarily of a noncash gain related to the remeasurement of the warrants issued in connection with our November 2023 agreement with Tempus.

Current wording

Other income (expense), net includes foreign currency exchange gains and losses. Other income (expense), net during the three and nine months ended September 30, 2024 consisted primarily of a noncash loss related to the remeasurement of the warrants issued in connection with our November 2023 agreement with Tempus.

Previous wording

(1) Includes related party revenue of $1.9 million and $2.4 million for the three and six months ended June 30, 2025, respectively.

Current wording

(1) Includes related party revenue of $1.1 million and $3.5 million for the three and nine months ended September 30, 2025, respectively.

Previous wording

(2) Includes related party sales and marketing expenses of $0.9 million and $1.5 million for the three and six months ended June 30, 2025, respectively.

Current wording

(2) Includes related party sales and marketing expenses of $1.2 million and $2.7 million for the three and nine months ended September 30, 2025, respectively.

Previous wording

(1) Includes related party accounts receivable of $1.9 million and $2.5 million as of June 30, 2025 and December 31, 2024, respectively.

Current wording

(1) Includes related party accounts receivable of $2.6 million and $2.5 million as of September 30, 2025 and December 31, 2024, respectively.

Previous wording

(2) Includes related party liabilities of $4.8 million and $2.9 million as of June 30, 2025 and December 31, 2024, respectively.

Current wording

(2) Includes related party liabilities of $5.7 million and $2.9 million as of September 30, 2025 and December 31, 2024, respectively.

Previous wording

(1) Includes related party revenue of $1.9 million and $2.4 million for the three and six months ended June 30, 2025, respectively.

Current wording

(1) Includes related party revenue of $1.1 million and $3.5 million for the three and nine months ended September 30, 2025, respectively.

Previous wording

The decrease in pharma tests and services revenue in the second quarter of 2025 was primarily due to fewer clinical trial samples processed for Moderna. We expect variability in revenue from pharmaceutical companies in the future due to the timing of their trial enrollments or project schedules. The increase in revenue from pharma tests and service revenue for the first half of 2025 compared to the same period of 2024 reflected an increased demand for our Next Personal MRD tests.

Current wording

The decreases in pharma tests and services revenue in the third quarter of 2025 and the first nine months of 2025 compared to the same periods of 2024 were primarily due to a decrease in the clinical trial samples processed for Moderna in addition to a small decline in selling prices. We expect variability in revenue from pharmaceutical companies in the future due to the timing of their trial enrollments or project schedules.

Previous wording

Our total revenue from Natera in 2025 is expected to be lower from comparable periods in 2024 due to the expected decrease in the number of samples processed. Our agreement with Natera included minimum volume commitments through the second quarter of 2025 and we do not expect to continue a long-term commercial relationship with Natera beyond this year.

Current wording

The decreases in revenue from enterprise sales in the third quarter of 2025 and the first nine months of 2025 were mainly due to the expected decrease in the number of samples processed for Natera compared to the same periods of 2024. Our agreement with Natera included minimum volume commitments through the second quarter of 2025 and we do not expect to continue a long-term commercial relationship with Natera beyond this year.

Previous wording

Revenue recognized each period from population sequencing is impacted by timing of our fulfillment of samples under each annual task order. The increases in revenue in the second quarter of 2025 and in the first half of 2025 compared to the same periods of 2024 were due to increases in the number of samples processed.

Current wording

Revenue recognized each period from population sequencing is impacted by timing of our fulfillment of samples under each annual task order. The decrease in revenue in the third quarter of 2025 compared to the same period of 2024 was due to decreases in the number of samples processed as we fulfilled the annual task order received in September 2024 during the first two quarters of 2025. The increase in revenue in the first nine months of 2025 compared to the same period of 2024 was due to increase in the total number of samples processed.

Previous wording

Our annual task orders received from the VA MVP in 2024 and 2023 were $7.5 million each year. Our contract with the VA MVP does not include specific testing turnaround times. Therefore, we may modulate the volume of samples processed from the VA MVP to accommodate sample volumes from other customers in order to utilize lab capacity efficiently, which may vary from period to period. We fulfilled the task order received in September 2024 during the first two quarters of 2025.

Current wording

Our annual task order received from the VA MVP in 2024 was $7.5 million. Our contract with the VA MVP does not include specific testing turnaround times. Therefore, we may modulate the volume of samples processed from the VA MVP to accommodate sample volumes from other customers in order to utilize lab capacity efficiently, which may vary from period to period. In August 2025, we received a new annual task order from the VA MVP with a value of up to $13.5 million that is effective on September 30, 2025.

Previous wording

Clinical diagnostic revenue is generated from Medicare and private insurance payors. In January 2024, we received a Medicare coverage determination for NeXT Dx, our ultra-comprehensive tumor genomic profiling assay. The increases in clinical diagnostic revenue in the second quarter of 2025 and in the first half of 2025 compared to the same periods of 2024 were mainly attributable to an increase in NeXT Dx test volume and NeXT Personal Dx reimbursements received from certain private payors.

Current wording

Clinical diagnostic revenue is generated from Medicare and private insurance payors. In January 2024, we received a Medicare coverage determination for NeXT Dx, our ultra-comprehensive tumor genomic profiling assay. The increases in clinical diagnostic revenue in the third quarter of 2025 and in the first nine months of 2025 compared to the same periods of 2024 were mainly attributable to an increase in NeXT Dx test volume and NeXT Personal Dx reimbursements received from certain private payors.

Previous wording

The decreases in cost of revenue in the second quarter of 2025 and in the first half of 2025 were primarily due to lower revenue levels. Cost of revenue decreased at a lesser rate as compared to the corresponding revenue decrease in the second quarter of 2025, primarily due to lower fixed overhead absorption, partially offset by increased clinical diagnostic test costs where the corresponding revenue and reimbursement rates were less than the cost to produce the tests.

Current wording

The decreases in cost of revenue in the third quarter of 2025 and in the first nine months of 2025 were primarily due to lower revenue levels. Cost of revenue decreased at a lesser rate as compared to the corresponding revenue decrease in the third quarter of 2025, primarily due to lower fixed overhead absorption, partially offset by increased clinical diagnostic test costs where the corresponding revenue and reimbursement rates were less than the cost to produce the tests.

Previous wording

Specific components of the decrease in the second quarter of 2025 were a $2.8 million decrease in direct material cost due to reduced samples processed, a $0.2 million decrease in laboratory supplies due to decreased Natera and pharmaceutical customer orders, partially offset by a $0.9 million increase in diagnostic test costs.

Current wording

Specific components of the decrease in the third quarter of 2025 were a $6.5 million and a $0.3 million decrease in direct material and labor costs, respectively, due to reduced samples processed, and a $0.2 million decrease in depreciation expense, partially offset by a $1.2 million increase in laboratory supplies, a $1.3 million increase in diagnostic test costs and a $0.1 million increase in equipment repairs and maintenance.

Previous wording

Specific components of the decrease in the first half of 2025 were a $4.4 million decrease in direct material cost due to reduced samples processed, a $0.5 million decrease in depreciation expenses resulting from capital equipment spend timing, partially offset by a $1.7 million increase in diagnostic test costs, a $0.3 million increase in labor costs and a $0.2 million increase in equipment repairs and maintenance.

Current wording

Specific components of the decrease in the first nine months of 2025 were a $10.8 million decrease in direct material cost due to reduced samples processed, a $0.6 million decrease in depreciation expenses resulting from capital equipment spend timing and a $0.3 million decrease in facilities costs, partially offset by a $3.1 million increase in diagnostic test costs, a $1.1 million increase in laboratory supplies costs and a $0.4 million increase in equipment repairs and maintenance.

Previous wording

Specific components of the decrease in the first half of 2025 were a $1.0 million decrease in lab supplies utilized, partially offset by a $0.3 million increase in personnel costs.

Current wording

Specific components of the decrease in the first nine months of 2025 were a $2.0 million decrease in lab supplies utilized, partially offset by a $1.0 million increase in research and development collaboration costs, a $0.4 million increase in repairs and maintenance, a $0.3 million increase in professional service and a $0.1 million increase in personnel costs.

Previous wording

The increases in selling, general and administrative expenses in the second quarter of 2025 and in the first half of 2025 compared to the same periods of 2024 were primarily due to expanded marketing programs related to NeXT Personal Dx.

Current wording

The increases in selling, general and administrative expenses in the third quarter of 2025 and in the first nine months of 2025 compared to the same periods of 2024 were primarily due to expanded marketing programs related to NeXT Personal Dx.

Previous wording

Specific components of the increase in the second quarter of 2025 were a $1.4 million increase in marketing and marketing related activities such as trade show expenses and Tempus' sales & marketing expenses, a $0.8 million increase in personnel costs and a $0.5 million increase in costs for marketing to physicians, partially offset by a $0.5 million decrease in professional outside services.

Current wording

Specific components of the increase in the third quarter of 2025 were a $0.8 million increase in marketing and marketing related activities such as Tempus' sales & marketing expenses, a $0.7 million increase in professional outside services, a $0.3 million increase in costs for marketing to physicians and a $0.2 million increase in repairs and maintenance, partially offset by a $0.4 million decrease in personnel costs.

Previous wording

Specific components of the increase in the first half of 2025 were a $1.8 million increase in marketing and marketing-related expenses such as trade show expenses and Tempus' sales & marketing expenses, a $1.1 million increase in personnel costs and a $0.8 million increase in costs for marketing to physicians, partially offset by a $0.8 million decrease in professional outside services.

Current wording

Specific components of the increase in the first nine months of 2025 were a $2.6 million increase in marketing and marketing-related expenses such as trade show expenses and Tempus' sales & marketing expenses, a $1.0 million increase in costs for marketing to physicians, a $0.8 million increase in personnel costs, a $0.5 million increase in office expenses and a $0.3 million increase in personnel-related costs, partially offset by a $0.4 million decrease in facilities costs and a $0.3 million decrease in professional service fees.

Previous wording

The increases in interest income in the second quarter of 2025 and the first half of 2025 compared to the same periods of 2024 were driven by higher average investment balances, partially offset by decreased yields. Interest expense is the recognition of imputed interest on noninterest bearing loans.

Current wording

The increases in interest income in the third quarter of 2025 and the first nine months of 2025 compared to the same periods of 2024 were driven by higher average investment balances, partially offset by decreased yields. Interest expense is the recognition of imputed interest on noninterest bearing loans.

Previous wording

Other income (expense), net, in the second quarter of 2025 and the first half of 2025, consisted mainly of foreign currency remeasurements. Other income (expense), net in the second quarter of 2024 and the first half of 2024 consisted mainly of a $3.0 million and a $7.7 million noncash gain, respectively, recognized as a result of remeasurement of the Tempus Warrants (classified as liability instruments). These noncash gains were partially offset by a $0.2 million reclassification of accumulated foreign currency translation loss to other income (expense), net, upon dissolution of our China entity (Personalis (Shanghai) Ltd.) in the first quarter of 2024.

Current wording

Other income (expense), net, in the third quarter of 2025 and the first nine months of 2025, consisted mainly of foreign currency remeasurements. Other income (expense), net in the third quarter of 2024 and the first nine months of 2024 consisted mainly of a $26.0 million and a $18.3 million noncash loss, respectively, recognized as a result of remeasurement of the Tempus Warrants (classified as liability instruments).

Previous wording

From our inception through June 30, 2025, we have funded our operations primarily from net proceeds from issuance of redeemable convertible preferred stock, issuance of common stock through our initial public offering, follow-on equity offerings and our ATM facility (see Note 2, Summary of Significant Accounting Policies, in Part 1, Item 1 of this Form 10-Q in our Consolidated Financial Statements for additional information). Additionally, we have funded our operations from Tempus exercising warrants and purchasing additional shares of our common stock under an investment agreement, and Merck & Co., Inc.(“Merck”) purchasing shares of our common stock under an investment agreement (see Note 8, Related Party Transactions, in Part 1, Item 1 of this Form 10-Q in our Consolidated Financial Statements for additional information), as well as cash from operations and debt financings. As of June 30, 2025, we had cash and cash equivalents of $53.4 million and short-term investments of $119.9 million.

Current wording

From our inception through September 30, 2025, we have funded our operations primarily from net proceeds from issuance of redeemable convertible preferred stock, issuance of common stock through our initial public offering, follow-on equity offerings and our ATM facility (see Note 2, Summary of Significant Accounting Policies, in Part 1, Item 1 of this Form 10-Q in our Consolidated Financial Statements for additional information). Additionally, we have funded our operations from Tempus exercising warrants and purchasing additional shares of our common stock under an investment agreement, and Merck & Co., Inc. (“Merck”) purchasing shares of our common stock under an investment agreement (see Note 8, Related Party Transactions, in Part 1, Item 1 of this Form 10-Q in our Consolidated Financial Statements for additional information), as well as cash from operations and debt financings. As of September 30, 2025, we had cash and cash equivalents of $50.0 million and short-term investments of $100.5 million.

Previous wording

We have based these future funding requirements on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. If our available cash balances and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, including because of lower demand for our services or other risks described in this Quarterly Report on Form 10-Q, we may seek to sell additional common or preferred equity or convertible debt securities, enter into an additional credit facility or another form of third-party funding or seek other debt financing. We filed a sales agreement prospectus supplement in December 2024, pursuant to which we may offer and sell up to $50.0 million of shares of our common stock through our ATM facility. The sale of equity and convertible debt securities may result in dilution to our stockholders and, in the case of preferred equity securities or convertible debt, those securities could provide for rights, preferences or privileges senior to those of our common stock. The terms of debt securities issued or borrowings pursuant to a credit agreement could impose significant restrictions on our operations. Additional capital may not be available on reasonable terms, or at all. Our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from tariffs, other restrictive trade policies, the current administration’s focus on reducing government research spending and federal cost-cutting initiatives, actual or perceived changes in interest rates and inflation, and other macroeconomic factors. If we are unable to raise additional capital when needed or on favorable terms, our business, results of operations and financial condition would be adversely affected.

Current wording

We have based these future funding requirements on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. If our available cash balances and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, including because of lower demand for our services or other risks described in this Quarterly Report on Form 10-Q, we may seek to sell additional common or preferred equity or convertible debt securities, enter into an additional credit facility or another form of third-party funding or seek other debt financing. We filed a sales agreement prospectus supplement in December 2024, pursuant to which we may offer and sell up to $50.0 million of shares of our common stock through our ATM facility, of which approximately $32.0 million remains available for sale as of September 30, 2025.The sale of equity and convertible debt securities may result in dilution to our stockholders and, in the case of preferred equity securities or convertible debt, those securities could provide for rights, preferences or privileges senior to those of our common stock. The terms of debt securities issued or borrowings pursuant to a credit agreement could impose significant restrictions on our operations. Additional capital may not be available on reasonable terms, or at all. Our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from tariffs, other restrictive trade policies, the current administration’s focus on reducing government research spending and federal cost-cutting initiatives, actual or perceived changes in interest rates and inflation, and other macroeconomic factors. If we are unable to raise additional capital when needed or on favorable terms, our business, results of operations and financial condition would be adversely affected.

Previous wording

The decrease in cash used in operating activities was primarily due to reduced working capital needs.

Current wording

The increase in cash used in operating activities was primarily due to working capital needs and lower revenue with reduced gross margin.

Previous wording

The increase in cash used by investing activities was due to investment of our cash into short-term investments and a $2.7 million increase in capital expenditures.

Current wording

The decrease in cash used in investing activities was due to a $5.0 million decrease in investment of our cash into short-term investments, partially offset by a $4.3 million increase in capital expenditures.

Previous wording

The increase in cash provided by financing activities was due to $15.0 million higher net proceeds from sales of common stock under our ATM facility, $2.6 million in proceeds from loans and $0.3 million higher proceeds from our employee stock purchase program, partially offset by $0.8 million higher repayments of loans.

Current wording

The decrease in cash provided by financing activities was due to a $12.2 million lower net proceeds from sales of common stock under our ATM facility, a $35.5 million decrease from the proceeds of the Tempus warrant exercise and stock sale and a $0.9 million higher repayments of loans, partially offset by a $2.6 million increase in the loan receipts and $0.4 million higher proceeds from our employee stock purchase program.

Previous wording

Our material cash requirements in the short- and long-term consist primarily of variable costs of revenue, operating expenditures, capital expenditures, property leases, and other spend. We plan to fund our material cash requirements with our existing cash and cash equivalents and short-term investments, which amounted to $173.2 million as of June 30, 2025, as well as anticipated cash receipts from customers. To fund our material cash requirements in the short- and long-term, we may also seek to sell additional common or preferred equity or convertible debt securities, enter into an additional credit facility or another form of third-party funding or seek other debt financing.

Current wording

Our material cash requirements in the short- and long-term consist primarily of variable costs of revenue, operating expenditures, capital expenditures, property leases, and other spend. We plan to fund our material cash requirements with our existing cash and cash equivalents and short-term investments, which amounted to $150.5 million as of September 30, 2025, as well as anticipated cash receipts from customers. To fund our material cash requirements in the short- and long-term, we may also seek to sell additional common or preferred equity or convertible debt securities, enter into an additional credit facility or another form of third-party funding or seek other debt financing.

Previous wording

Variable costs of revenue. From time to time in the ordinary course of business, we enter into agreements with vendors for the purchase of raw materials, laboratory supplies and consumables to be used in the sequencing of customer samples. However, we generally do not have binding and enforceable purchase orders beyond the short term, and the timing and magnitude of purchase orders beyond such period is difficult to accurately project. We currently expect spending in this area to increase in 2025 in order to support the planned increase in clinical test volumes ahead of expected Medicare reimbursement.

Current wording

Variable costs of revenue. From time to time in the ordinary course of business, we enter into agreements with vendors for the purchase of raw materials, laboratory supplies and consumables to be used in the sequencing of customer samples. However, we generally do not have binding and enforceable purchase orders beyond the short term, and the timing and magnitude of purchase orders beyond such period is difficult to accurately project. We currently expect spending in this area to increase in 2025 in order to support the planned increase in clinical test volumes ahead of planned Medicare reimbursement.

Previous wording

Property leases. Our noncancelable operating lease payments were $66.3 million as of June 30,2025. The timing of these future payments, by year, can be found in Note 7, Leases, in Part I, Item 1 of this Form 10-Q in the Consolidated Financial Statements.

Current wording

Property leases. Our noncancelable operating lease payments were $64.3 million as of September 30,2025. The timing of these future payments, by year, can be found in Note 7, Leases, in Part I, Item 1 of this Form 10-Q in the Consolidated Financial Statements.

Previous wording

Other. As of June 30, 2025, we have an outstanding noninterest bearing loan that was used to finance the purchase of lab equipment and software licenses. We owe a total of $2.9 million, of which the majority is payable in the next twelve months. Further discussion of the loan can be found in Note 6, Loans, in Part I, Item 1 of this Form 10-Q in the Consolidated Financial Statements.

Current wording

Other. As of September 30, 2025, we have an outstanding noninterest bearing loan that was used to finance the purchase of lab equipment and software licenses. We owe a total of $2.5 million, of which the majority is payable in the next twelve months. Further discussion of the loan can be found in Note 6, Loans, in Part I, Item 1 of this Form 10-Q in the Consolidated Financial Statements.