Fulgent Genetics, Inc.
For the period ended Jun 30, 2026. Filed Jul 30, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Jul 30, 2026
FLGT$23.74+27.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-01.
0001193125-26-199065
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-07-30.
0001193125-26-326136
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 71 previous paragraphs and 82 current paragraphs.
43 unchanged; 24 reworded; 14 added; 4 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Recent Developments
Current report
On June 1, 2026, we presented updated data from our ongoing Phase 2 study of FID-007 in combination with cetuximab in patients with recurrent or metastatic head and neck squamous cell carcinoma at the American Society of Clinical Oncology (ASCO) 2026 Annual Meeting. As of an April 16, 2026 data cutoff, the combination demonstrated an objective response rate of 61.9%, a median progression-free survival of 6.7 months, a median duration of response of 7.4 months, and a one-year overall survival rate of 63.4%, with a manageable safety profile. These are preliminary, interim data from an ongoing clinical study, and there can be no assurance that later-stage or larger trials will replicate these results or that we will obtain regulatory approval for FID-007.
Current report
Revenue increased by $1.3 million, or 1%, from $155.3 million in the six months ended June 30, 2025, to $156.5 million in the six months ended June 30, 2026. The increase in revenue between periods was driven by increases of $9.2 million in anatomic pathology and $1.8 million in BioPharma services, partially offset by decreases of $9.8 million in precision diagnostics.
Current report
Our consolidated cost of revenue increased by $12.3 million, or 26%, from $47.4 million in the three months ended June 30, 2025, to $59.7 million in the three months ended June 30, 2026. The increase in cost of revenue was primarily due to increases of $11.1 million in cost of revenue resulting from assets and the business acquired in the Bako Acquisition and $1.2 million in depreciation expenses.
Current report
Our consolidated cost of revenue increased by $16.9 million, or 18%, from $92.5 million in the six months ended June 30, 2025, to $109.4 million in the six months ended June 30, 2026. The increase in cost of revenue was primarily due to increases of $12.8 million in cost of revenue resulting from assets and the business acquired in the Bako Acquisition and increases of $1.8 million in shipping and handling expenses, $1.6 million in depreciation expenses, and $0.9 million in consulting and outside labor costs.
Current report
For the therapeutic development segment, the research and development expenses in the six months ended June 30, 2026, totaled $11.7 million and consisted of $5.7 million in personnel costs, including equity-based compensation, and $4.8 million in CRO costs. In the six months ended June 30, 2025, these expenses totaled $11.3 million and comprised $5.5 million in CRO costs and $5.0 million of personnel expenses, including equity-based compensation. Other expense categories including facilities and depreciation are not individually significant and have remained stable.
Current report
Research and development expenses for the therapeutic development segment remained flat for each of the three and six months ended June 30, 2026 and 2025.
Current report
We have confirmed an end of Phase 2 meeting for FID-007 with the FDA which is scheduled before the end of August 2026 and, assuming favorable discussions with the FDA, we plan to commence a Phase 3 trial of FID-007 for the treatment of patients diagnosed with recurrent or metastatic head and neck squamous cell carcinoma in the first half of 2027.
Current report
Our consolidated selling and marketing expenses increased by $6.7 million, or 32%, from $20.8 million in the six months ended June 30, 2025, to $27.4 million in the six months ended June 30, 2026. The increase in consolidated selling and marketing expenses was due to increase of $4.7 million resulting from assets and the business acquired in the Bako Acquisition, $2.2 million in personnel costs due to increased headcount, and $1.4 million in software and software licensing, partially offset by decreases of $1.9 million in advertising and marketing expenses.
Current report
Our consolidated general and administrative expenses increased by $0.8 million, or 3%, from $26.4 million in the three months ended June 30, 2025, to $27.2 million in the three months ended June 30, 2026. The increase in consolidated general and administrative expenses was due to increases of $3.6 million resulting from assets and the business acquired in the Bako Acquisition and $0.7 million in software and software licensing costs, partially offset by decreases of $1.9 million in legal expense and $0.7 million of bonus expense.
Current report
Impairment of Intangible Assets
Current report
During the three months ended June 30, 2026, we identified a triggering event with respect to a finite-lived customer relationship intangible asset acquired as part of the ANP acquisition, resulting from loss of a significant customer relationship. As a result, we recorded an impairment charge of $2.2 million during the three months ended June 30, 2026, representing the remaining net carrying value of the intangible asset after accumulated amortization since the ANP acquisition date, effectively writing off the asset in its entirety. The impairment charge is reflected within a separate line item in the Condensed Consolidated Statements of Operations. There was no such impairment charges for intangible assets in prior year.
Current report
Provision for (Benefit from) Income Taxes
Current report
In addition and as discussed above, we are in the process of transitioning our billing and revenue cycle management system, which has required us to rebuild and implement significant customizations. The final phase of this transition and the related customization needed for this system to work as intended remain ongoing and are not yet complete. As a result, we have encountered processing delays affecting our collections rate and some delayed amounts may not ultimately be collected at the rate we expect. As the remaining customizations are completed and integrated across our revenue cycle, we expect our collection rates to improve, though we cannot predict the exact timing of that improvement. We do not believe this matter will impact our ability to meet our anticipated cash requirements for at least the next 12 months, but continued delays in completing this transition could further affect our collections, liquidity, and results of operations.
Removed paragraphs (4)
Previous report
not meaningful
Previous report
Our consolidated cost of revenue increased by $4.5 million, or 10%, from $45.1 million in the three months ended March 31, 2025, to $49.6 million in the three months ended March 31, 2026. The increase was primarily due to increases of $1.8 million in personnel expenses due to increased headcount, $1.5 million in shipping and handling expenses, $0.7 million in reagent and supply costs, $0.5 million in depreciation expense, and $0.5 million in consulting costs, and partially offset by a decrease of $0.5 million in software and software licensing. The increases in personnel expenses/headcount and other cost of revenue items for the three months ended March 31, 2026, include the impact of absorbing the Bako and StrataDx operations from the March 17, 2026 acquisition date. Because the acquired operations were included for only approximately two weeks of the quarter, we expect cost of revenue to increase in future quarters as the Bako Acquisition operations are more fully reflected in our consolidated results.
Previous report
In the three months ended March 31, 2026, the research and development expenses for the laboratory services segment primarily consisted of $7.1 million in personnel expenses, including bonuses and equity-based compensation, $1.1 million in reagent and supply costs, $0.1 million in depreciation expense, and $0.1 million in facility expenses. In the three months ended March 31, 2025, expenses primarily consisted of $6.3 million in personnel expenses, including bonuses and equity-based compensation, $0.4 million in reagent and supply costs, $0.1 million in facility expenses, and $0.1 million in depreciation expense.
Previous report
(Benefit from) Provision for Income Taxes
Reworded paragraphs (24)
Previous wording
On March 17, 2026 and as further described in Note 15, Business Combinations, to the condensed consolidated financial statements included in this report, we completed the acquisition of certain assets of Bako Diagnostics and acquired StrataDx, or collectively, the Bako Acquisition, which together provide dermatopathology, podiatric pathology, and molecular diagnostic services and therapeutic products. As the Bako Acquisition closed late in the first quarter, the results for the three months ended March 31, 2026, include only approximately two weeks of the acquired operations. We expect the additional impact of the Bako Acquisition on our consolidated results of operations, including revenue, cost of revenue, and operating expenses, to be reflected in the second quarter of 2026 and in future periods.
Current wording
On March 17, 2026, and as further described in Note 15. Business Combinations, to the condensed consolidated financial statements included in this report, we completed the acquisition of certain assets of Bako Diagnostics and acquired StrataDx, or collectively, the Bako Acquisition, which together provide dermatopathology, podiatric pathology, and molecular diagnostic services and therapeutic products. As the Bako Acquisition closed late in the first quarter, the results for the six months ended June 30, 2026, include only approximately three and a half months of the acquired operations. We expect the additional impact of the Bako Acquisition on our consolidated results of operations, including revenue, cost of revenue, and operating expenses, to be reflected in future periods.
Previous wording
Our business and prospects are exposed to numerous risks and uncertainties, as described below and in our 2025 Annual Report. In particular, the Bako Acquisition is a major transaction involving the integration of significant operations into our existing laboratory business. As described in greater detail in the risk factors included in our 2025 Annual Report, these acquisitions involve inherent risks, including potential difficulties in integrating operations, personnel, and technologies, and the potential for higher than anticipated acquisition-related costs or integration expenses. Ultimately, we may not realize the anticipated benefits of this transaction. For more information, see “Item 1A. Risk Factors” in Part I of the 2025 Annual Report. In addition, our performance in any period is affected by a number of other factors. See the description of some of the material factors affecting our performance in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2025 Annual Report.
Current wording
Our business and prospects are exposed to numerous risks and uncertainties, as described in our 2025 Annual Report. In particular, the Bako Acquisition is a transaction involving the integration of operations into our existing laboratory business. As described in greater detail in the risk factors included in our 2025 Annual Report, these acquisitions involve inherent risks, including potential difficulties in integrating operations, personnel, and technologies, and the potential for higher than anticipated acquisition-related costs or integration expenses. Ultimately, we may not realize the anticipated benefits of this transaction. For more information, see “Item 1A. Risk Factors” in Part I of the 2025 Annual Report. In addition, our performance in any period is affected by a number of other factors. See the description of some of the material factors affecting our performance in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the 2025 Annual Report.
Previous wording
Revenue decreased by $2.3 million, or 3%, from $73.5 million in the three months ended March 31, 2025, to $71.1 million in the three months ended March 31, 2026. The decrease in revenue between periods was driven by decreases of $3.9 million in precision diagnostics and $0.2 million in anatomic pathology, partially offset by an increase of $1.7 million in BioPharma services from the laboratory services reportable segment and $0.1 million in BioPharma services from the therapeutic development segment.
Current wording
Revenue increased by $3.6 million, or 4%, from $81.8 million in the three months ended June 30, 2025, to $85.4 million in the three months ended June 30, 2026. The increase in revenue between periods was driven by increases of $9.4 million in anatomic pathology and $0.2 million in BioPharma services, partially offset by decreases of $6.0 million in precision diagnostics.
Previous wording
The decrease in precision diagnostics revenue was driven by the decline in revenue from our largest customer as this customer begins to perform tests internally. As previously disclosed in our Form 10-K, we expect revenues for our largest customer to continue to decline in 2026 as this customer increases its performance of tests internally. The tests and testing services this customer has historically purchased were primarily precision diagnostic tests. To reduce this revenue risk, we will focus on developing existing customers and increasing the number of customers and thereby reducing the concentration and on successfully integrating our acquired businesses. Anatomic pathology services remained relatively consistent, with the decrease primarily due to a timing impact from claims that were delayed in release, partially offset by $2.6 million in revenue resulting from the Bako Acquisition during the first quarter. The volume of our anatomic pathology testing services can fluctuate during holiday periods and can decline due to extreme adverse weather conditions leading to temporary laboratory closures as experienced during 2026. The increase in BioPharma services revenue was primarily due to the timing of service projects, though this revenue is expected to remain variable due to the long sales cycle and fluctuations in project timing.
Current wording
The decrease in precision diagnostics revenue was driven by the decline in revenue from our largest customer as this customer begins to perform tests internally. As previously disclosed in our 2025 Annual Report, we expect revenues for our largest customer to continue to decline in 2026 as this customer continues to increase the performance of tests internally. The tests and testing services this customer has historically purchased were primarily precision diagnostic tests. To reduce this revenue risk, we will focus on developing existing customers and increasing the number of customers and thereby reducing the concentration and on successfully integrating our acquired businesses. The increase in anatomic pathology services was primarily due to $12.9 million in revenue resulting from assets and the business acquired in the Bako Acquisition, partially offset by decreases due to the impact of the final phase of the transition of our billing and revenue cycle management system which has resulted in significant processing backlogs and collections delays. We are actively seeking to address these transition issues, but we may be unable to resolve these issues in a timely manner or as quickly as we presently expect. The volume of our anatomic pathology testing services can fluctuate during holiday periods and can decline due to extreme adverse weather conditions leading to temporary laboratory closures as experienced during 2026. The increase in BioPharma services revenue was primarily due to the timing of service projects, though this revenue is expected to remain variable due to the long sales cycle and fluctuations in project timing.
Previous wording
Our customer base includes insurance, institutional, and individual payors. In some periods, our revenue is concentrated on a smaller number of customers. For the laboratory services segment, aggregating customers that are under common control, our largest customer comprised $10.4 million, or 15%, of our revenue in the three months ended March 31, 2026, and $17.6 million, or 24%, of our revenue in the three months ended March 31, 2025. As previously disclosed, we expect revenues for this customer to continue to decline in 2026 as this customer transitions the performance of tests internally.
Current wording
Our customer base includes insurance, institutional, and individual payors. In some periods, our revenue is concentrated on a smaller number of customers. For the laboratory services segment, aggregating customers that are under common control, no customer represented a significant concentration of revenue in the three months ended June 30, 2026, but one customer comprised $16.1 million, or 10%, of total revenue in the six months ended June 30, 2026. The same customer contributed $17.6 million, or 22%, of our revenue in the three months ended June 30, 2025, and contributed $35.2 million, or 23%, of total revenue in the six months ended June 30, 2025. As previously disclosed, we expect revenues for this customer to continue to decline in 2026 as this customer continues to transition the performance of tests internally.
Previous wording
Revenue from the therapeutic development segment includes amounts recognized by ANP from technologies licensed to pharmaceutical and biotechnology companies, as well as CROs. In addition, ANP has a manufacturing and supply agreement with a customer for specific COVID-19 testing kits, under which, ANP is entitled to participate in gross-margin sharing on the sale of those kits. The timing of the gross-margin sharing revenue is dependent on the customer’s downstream sales of the kits. An insignificant amount of gross-margin sharing revenue was recognized for the three months ended March 31, 2026.
Current wording
Revenue from the therapeutic development segment includes amounts recognized by ANP Technologies, Inc., or ANP, from technologies licensed to pharmaceutical and biotechnology companies, as well as CROs. An insignificant amount of gross-margin sharing revenue was recognized for the six months ended June 30, 2026. No further gross-margin sharing revenue is expected from this manufacturing and supply agreement.
Previous wording
Revenue from non-U.S. sources increased by $0.4 million, or 7%, from $5.6 million in the three months ended March 31, 2025, to $6.0 million in the three months ended March 31, 2026. The increase was primarily due to increases in total revenue to Australia of $0.7 million and Canada of $0.3 million, partially offset by a decrease in total revenue to the United Kingdom of $0.6 million.
Current wording
Revenue from non-U.S. sources increased by $1.5 million, or 27%, from $5.6 million in the three months ended June 30, 2025, to $7.1 million in the three months ended June 30, 2026. The increase in the three-month period was primarily due to increases in total revenue to China of $0.7 million, Australia of $0.4 million, and United Kingdom of $0.2 million. Revenue from non-U.S. sources increased by $1.9 million, or 17%, from $11.2 million in the six months ended June 30, 2025, to $13.2 million in the six months ended June 30, 2026. The increase in the six-month period was primarily due to increases in total revenue to Australia of $0.7 million, China of $0.6 million, and United Kingdom of $0.4 million.
Previous wording
Our consolidated cost of revenue as a percentage of revenue increased from 61% in the three months ended March 31, 2025, to 70% in the three months ended March 31, 2026.
Current wording
Our consolidated cost of revenue as a percentage of revenue increased from 58% in the three months ended June 30, 2025, to 70% in the three months ended June 30, 2026. Our consolidated cost of revenues as a percentage of revenue increased from 60% in the six months ended June 30, 2025, to 70% in the six months ended June 30, 2026.
Previous wording
Our gross profit decreased by $6.9 million, or 24%, from $28.3 million in the three months ended March 31, 2025, to $21.5 million in the three months ended March 31, 2026. Our gross profit as a percentage of revenue, or gross margin, decreased from 39% in the three months ended March 31, 2025, to 30% in the three months ended March 31, 2026. This was driven by the decreased revenue, for the reasons described above, and increased headcount.
Current wording
Our gross profit decreased by $8.8 million, or 25%, from $34.4 million in the three months ended June 30, 2025, to $25.7 million in the three months ended June 30, 2026, and decreased by $15.6 million, or 25%, from $62.8 million in the six months ended June 30, 2025, to $47.2 million in the six months ended June 30, 2026. Our gross profit as a percentage of revenue, or gross margin, decreased from 42% in the three months ended June 30, 2025, to 30% in the three months ended June 30, 2026, and 40% in the six months ended June 30, 2025, to 30% in the six months ended June 30, 2026. This was driven by the lower collection rate and higher fixed costs, reducing operating leverage primarily resulting from processing and collections delays in connection with the final phase of the implementation of our new billing and revenue cycle management system. This system is complex, and the challenges have been mostly related to implementing the customizations needed to maximize reimbursement that were not fully built into the initial launch. That customization work remains ongoing today. We have made progress implementing a number of the required customizations and remain focused on completing the remaining work as quickly as possible. As the remaining customizations are completed and integrated across our revenue cycle, we expect our collection rate, and correspondingly our gross margin, to improve, though we cannot predict the exact timing of that improvement.
Previous wording
For the laboratory services segment, the research and development expenses were mainly for advancing our technology and future testing and testing services. The expenses increased by $1.4 million, or 20%, from $7.1 million in 2025 to $8.5 million in 2026. The increase was primarily attributed to increases of $0.8 million in personnel expenses and $0.7 million in reagents and supplies expenses, partially offset by a decrease of $0.1 million in facility expenses.
Current wording
For the laboratory services segment, the research and development expenses were mainly for advancing our technology and future testing and testing services. The expenses increased by $2.5 million, or 17% from $14.5 million in the six months ended June 30, 2025, to $17.0 million in the six months ended June 30, 2026. The increase was primarily attributed to increases of $1.7 million in reagents and supplies expenses and $0.9 million in personnel expenses.
Previous wording
For the therapeutic development segment, the research and development expenses in the three months ended March 31, 2026, included $2.9 million in personnel costs, including equity-based compensation, $2.4 million in CRO costs, $0.2 million in facility expenses, and $0.1 million in depreciation expenses. In the three months ended March 31, 2025, these expenses comprised $2.6 million in CRO costs, $2.4 million in personnel costs, including equity-based compensation, and $0.2 million in depreciation expenses.
Current wording
For the therapeutic development segment, the research and development expenses in the three months ended June 30, 2026, totaled $6.0 million and consisted of $2.8 million in contract research organization, or CRO, costs, and $2.7 million in personnel costs, including equity-based compensation. In the three months ended June 30, 2025, these expenses totaled $6.0 million and comprised $3.0 million in CRO costs and $2.6 million of personnel costs, including equity-based compensation. Other expense categories including facilities and depreciation are not individually significant and have remained stable.
Previous wording
Research and development expenses for the therapeutic development segment increased by $0.4 million, or 7%, from $5.3 million in the three months ended March 31, 2025, to $5.7 million in the three months ended March 31, 2026. The increase was primarily driven by increases of $0.5 million in personnel costs, including equity-based compensation expense, and $0.1 million in facility expenses, partially offset by a decrease of $0.2 million in CRO costs. The overall increase was attributed to the advancement and continuation of the clinical study of FID-007, along with FID-022. In the three months ended March 31, 2026, approximately $1.0 million was incurred for the clinical development of FID-022, which was consistent with the related costs of approximately $1.0 million in the three months ended March 31, 2025. Expenses for our therapeutic development segment will be influenced by our ability to progress our therapeutic candidates through development with the FDA, the timing of which can be uncertain and delayed due to a variety of factors beyond our control, including staff reductions at the FDA and the effects or residual effects of the recent U.S. “government shutdowns,” which may affect the FDA’s ability to provide any required approvals or review in a timely manner or in the timelines expected.
Current wording
Expenses for our therapeutic development segment will be influenced by our ability to progress our therapeutic candidates through development with the Food and Drug Administration, or the FDA, the timing of which can be uncertain and delayed due to a variety of factors beyond our control, including staff reductions at the FDA, which may affect the FDA’s ability to provide any required approvals or review in a timely manner or in the timelines expected.
Previous wording
Our consolidated selling and marketing expenses increased by $3.8 million, or 44%, from $8.5 million in the three months ended March 31, 2025, to $12.2 million in the three months ended March 31, 2026. The increase in consolidated selling and marketing expenses was due to increases of $2.4 million in personnel expenses, $1.1 million in software licensing, $0.2 million in travel expenses, $0.1 million in trade show expenses, and $0.1 million in supply and material expenses, partially offset by a decrease of $0.1 million in consulting expenses.
Current wording
Our consolidated selling and marketing expenses increased by $2.9 million, or 24%, from $12.3 million in the three months ended June 30, 2025, to $15.2 million in the three months ended June 30, 2026. The increase in consolidated selling and marketing expenses was due to increase of $3.9 million resulting from assets and the business acquired in the Bako Acquisition, partially offset by decreases of $1.8 million in advertising and marketing expenses.
Previous wording
Our consolidated general and administrative expenses increased by $2.4 million, or 9%, from $25.3 million in the three months ended March 31, 2025, to $27.7 million in the three months ended March 31, 2026. The increase in consolidated general and administrative expenses was due to increases of $2.6 million in acquisition-related costs primarily related to the Bako Acquisition, $0.8 million in legal fees, $0.2 million in personnel costs, and $0.1million in insurance expenses, partially offset by decreases of $0.9 million in provision for credit losses, $0.3 million in depreciation expenses, and $0.3 million in accounting expenses.
Current wording
Our consolidated general and administrative expenses increased by $3.2 million, or 6%, from $51.7 million in the six months ended June 30, 2025, to $54.9 million in the six months ended June 30, 2026. The increase in consolidated general and administrative expenses was due to increase of $4.7 million resulting from assets and the business acquired in the Bako Acquisition, partially offset by decreases of $1.0 million in bonus expense.
Previous wording
Other income (expenses), is primarily comprised of interest income, which was $8.7 million in the three months ended March 31, 2026, and $8.0 million in the three months ended March 31, 2025. This interest income included interest earned on marketable securities and realized gain or loss on sale of marketable securities, as well as interest accrued for outstanding federal tax refunds. The change in interest income was primarily due to the interest earned from the outstanding federal tax refunds, partially offset by lower overall marketable security balances.
Current wording
Other income (expense) is primarily comprised of interest income, which was $6.4 million and $15.1 million in the three and six months ended June 30, 2026, respectively, and $8.1 million and $16.1 million in the three and six months ended June 30, 2025, respectively. This interest income included interest earned on marketable securities and realized gain or loss on sale of marketable securities, as well as interest accrued for outstanding federal tax refunds. The change in interest income was primarily due to the interest earned from the outstanding federal tax refunds, partially offset by lower overall marketable security balances. Other expenses primarily consisted of a one-time, non-cash impairment of a prior investment as discussed further in Note 4. Fair Value Measurements, of the financial statements included in this quarterly report.
Previous wording
(Benefit from) provision for income taxes was $(0.7) million and $0.2 million for the three months ended March 31, 2026, and 2025, respectively. The effective tax rate was 3% and (2)% for the three months ended March 31, 2026, and 2025, respectively. The change in the effective tax rate compared to prior periods was primarily driven by a one-time tax benefit resulting from the Bako Acquisition completed during the quarter, which allowed the Company to recognize a portion of the tax benefit from its net operating losses that had previously been reserved.
Current wording
Provision for (benefit from) income taxes was $0.03 million and ($0.7) million for the three and six months ended June 30, 2026, respectively, compared with ($2.3) million and ($2.1) million for the three and six months ended June 30, 2025, respectively. The Company’s effective tax rate was (0.1%) and 1% for the three and six months ended June 30, 2026, respectively, compared to 11% and 6% for the three and six months ended June 30, 2025, respectively. The change in the effective tax rate compared to prior periods was primarily driven by a one-time tax benefit resulting from the Bako Acquisition completed during the quarter, which allowed the Company to recognize a portion of the tax benefit from its net operating losses that had previously been reserved.
Previous wording
We had $604.7 million and $705.5 million in cash, cash equivalents, restricted cash, and marketable securities as of March 31, 2026, and December 31, 2025, respectively. Our marketable securities primarily consist of U.S. government and U.S. agency debt securities, corporate bonds, municipal bonds, and Yankee debt securities as of March 31, 2026, and December 31, 2025.
Current wording
We had $551.5 million and $705.5 million in cash, cash equivalents, restricted cash, and marketable securities as of June 30, 2026, and December 31, 2025, respectively. Our marketable securities primarily consist of U.S. government and U.S. agency debt securities, corporate bonds, and municipal bonds as of June 30, 2026, and December 31, 2025.
Previous wording
During the three months ended March 31, 2026, our operations provided $7.1 million of cash, as compared to $4.4 million used in the three months ended March 31, 2025. The increase in cash provided from operating activities in the three months ended March 31, 2026, as compared with the corresponding period in 2025 was primarily due to the timing of cash receipts from customers and cash payments for operating expenses, including bonus expenses. We expect to incur more operating expenses and use more cash in operating activities in the coming quarters as a result of our planned and ongoing clinical trials for FID-007 and FID-022, and as we continue to invest resources to grow our laboratory services business.
Current wording
During the six months ended June 30, 2026, our operations used $16.7 million of cash, as compared to $34.6 million used in the six months ended June 30, 2025. The decrease in cash used in operating activities in the six months ended June 30, 2026, as compared with the corresponding period in 2025, was primarily due to the purchase of IRA tax credits of $33.8 million in 2025, partially offset by $13.5 million cash payment in connection with the settlement of a professional liability matter during the three months ended June 30, 2026. The remaining is related to the timing of cash receipts from customers and cash payments for operating expenses. We expect to incur more operating expenses and use more cash in operating activities in the coming quarters as a result of our planned and ongoing clinical trials for FID-007 and FID-022, and as we continue to invest resources to grow our laboratory services business.
Previous wording
The cash provided by investing activities is impacted by capital expenditures for operation needs and timing of payments, timing of maturities of marketable securities, and discretionary business combinations and other investment.
Current wording
The cash provided by or used in investing activities is impacted by capital expenditures for operational needs and timing of payments, timing of maturities of marketable securities, and discretionary business combinations and other investments.
Previous wording
Cash provided by investing activities in the three months ended March 31, 2026, was $10.9 million, which primarily represents $81.7 million in the maturities of marketable securities, partially offset by $55.6 million related to business acquisitions, $10.0 million related to the purchase of marketable securities, and $5.2 million related to the purchase of fixed assets consisting mainly of building improvement, medical laboratory equipment, and computer hardware.
Current wording
Cash provided by investing activities in the six months ended June 30, 2026 was $61.7 million, which primarily represented $103.2 million in maturities of marketable securities, $33.1 million in proceeds from sale of marketable securities, partially offset by $55.6 million related to business acquisitions, $10.0 million from the purchase of marketable securities, and $9.1 million related to the purchase of fixed assets consisting mainly of building improvements, medical laboratory equipment, and computer hardware.
Previous wording
Cash provided by investing activities in the three months ended March 31, 2025, was $27.7 million, which primarily represents $32.4 million in the maturities of marketable securities, partially offset by $4.7 million related to the purchase of fixed assets consisting mainly of building improvement, medical laboratory equipment, and computer hardware.
Current wording
Cash provided by investing activities in the six months ended June 30, 2025, was $81.1 million, which primarily represented $92.7 million related to maturities of marketable securities, partially offset by $11.5 million related to the purchase of fixed assets consisting mainly of building improvement, medical laboratory equipment, and computer hardware.
Previous wording
Cash used in financing activities in the three months ended March 31, 2026, was $44.8 million, which primarily related to $40.1 million used in the repurchase of common stock and $4.2 million used in common stock withholding for employee tax obligations.
Current wording
Cash used in financing activities in the six months ended June 30, 2026, was $69.1 million, which primarily related to $63.9 million used in the repurchase of common stock and $4.5 million used in common stock withholding for employee tax obligations.
Previous wording
Cash used in financing activities in the three months ended March 31, 2025, was $11.2 million, which primarily related to $8.7 million used in the repurchase of common stock and $1.9 million used in common stock withholding for employee tax obligations.
Current wording
Cash used in financing activities in the six months ended June 30, 2025, was $13.8 million, which primarily related to $10.9 million for repurchase of common stock and $2.2 million used in common stock withholding for employee tax obligations.
Previous wording
During the three months ended March 31, 2026, we repurchased 2.6 million shares of our common stock at an aggregate cost of $40.1 million under the stock repurchase program. During the three months ended March 31, 2025, we repurchased 0.5 million shares of our common stock at an aggregate cost of $7.9 million under the stock repurchase program. As of March 31, 2026, a total of approximately $99.6 million remained available for future repurchases of our common stock under our stock repurchase program. From April 1, 2026, through May 1, 2026, we repurchased 0.5 million shares of our common stock for an aggregate cost of $8.7 million at an average price of $15.84 per share under our stock repurchase program. As of May 1, 2026, a total of $91.0 million remained available for future repurchases of our common stock under the stock repurchase program.
Current wording
During the three and six months ended June 30, 2026, we repurchased 1.5 million and 4.1 million shares of our common stock, respectively, at an aggregate cost of $23.8 million and $63.9 million, respectively, under the stock repurchase program. During the three and six months ended June 30, 2025, we repurchased 0.2 million and 0.6 million shares of our common stock, respectively, at an aggregate cost of $3.0 million and $10.9 million, respectively, under the stock repurchase program. As of June 30, 2026, a total of approximately $75.8 million remained available for future repurchases of our common stock under our stock repurchase program.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For the laboratory services segment, the research and development expenses were mainly for advancing our technology and future testing and testing services. The expenses increased by $1.1 million, or 15% from $7.5 million in the three months ended June 30, 2025, to $8.5 million in the three months ended June 30, 2026. The increase was primarily attributed to increases of $1.0 million in reagents and supplies expenses.