GeneDx Holdings Corp.

Previous wording

We believe several important factors have impacted, and will continue to impact, our performance and results of operations. While each of these areas presents significant opportunities for us, they also pose significant risks and challenges that we must address. See Item 1A, “Risk Factors” in this Quarterly Report and Part I, Item 1A “Risk Factors” in our 2025 Form 10-K, which are incorporated by reference in this Quarterly Report, for further information.

Current wording

We believe several important factors have impacted, and will continue to impact, our performance and results of operations. While each of these areas presents significant opportunities for us, they also pose significant risks and challenges that we must address. See Item 1A, “Risk Factors” in this Quarterly Report and Part I, Item 1A “Risk Factors” in our 2025 Form 10-K, as well as Part II, Item 1A, “Risk Factors” in our Quarterly Reports filed for the quarterly period ended March 31, 2026, filed with the SEC on May 4, 2026, and for the quarterly period ended June 30, 2026, filed with the SEC on August 3, 2026, which sections are incorporated by reference in this Quarterly Report, for further information.

Previous wording

We believe the number of resulted exome and genome tests in any period is important and useful to our investors because it directly correlates with long-term patient relationships and the size of our genomic database. During the three months ended June 30, 2026, we resulted 30,785 exome and genome tests, which represented 49% of all test results, compared to the three months ended June 30, 2025, in which we resulted approximately 23,246 exome and genome tests, which represented 40% of all test results. During the six months ended June 30, 2026, we resulted 58,273 exome and genome tests, which represented 49% of all test results, compared to the six months ended June 30, 2025, in which we resulted approximately 43,808 exome and genome tests, which represented 40% of all test results.

Current wording

We believe the number of resulted exome and genome tests in any period is important and useful to our investors because it directly correlates with long-term patient relationships and the size of our genomic database. During the three months ended September 30, 2026, we resulted 32,134 exome and genome tests, which represented 55% of all test results, compared to the three months ended September 30, 2025, in which we resulted 25,702 exome and genome tests, which represented approximately 43% of all test results. During the nine months ended September 30, 2026, we resulted 90,407 exome and genome tests, which represented 51% of all test results, compared to the nine months ended September 30, 2025, in which we resulted 69,510 exome and genome tests, which represented approximately 41% of all test results.

Previous wording

Other revenue decreased by a nominal amount, to $2.6 million for the three months ended June 30, 2026.

Current wording

Other revenue decreased by a nominal amount, to $3.0 million for the three months ended September 30, 2026.

Previous wording

Gross profit increased by $7.3 million or 10%, to $78.2 million for the three months ended June 30, 2026, from $70.9 million for the three months ended June 30, 2025, driven by a combination of a shift in test mix to more profitable whole exome and genome test and continued cost per test leverage.

Current wording

Gross profit increased by $1.5 million, or 2%, to $86.1 million for the three months ended September 30, 2026, from $84.5 million for the three months ended September 30, 2025, driven by a combination of a shift in test mix to more profitable whole exome and genome tests and continued cost per test leverage.

Previous wording

Selling, general and administrative expense increased by $29.2 million, or 62%, to $76.0 million for the three months ended June 30, 2026, from $46.9 million for the three months ended June 30, 2025. This increase primarily reflects strategic investments to support future growth, including a significant expansion of our commercial organization through increased sales representative headcount which resulted in increased compensation costs of $12.9 million. In addition, we incurred higher marketing expenditures of $1.8 million to support the continued investment in new customer experience capabilities. The increase also reflected higher third-party consulting costs of $3.8 million and IT software and infrastructure costs of $1.1 million. The prior period included a one-time sales-and-use tax refund of $8.4 million.

Current wording

Selling, general and administrative expense increased by $11.2 million, or 16%, to $79.1 million for the three months ended September 30, 2026, from $67.9 million for the three months ended September 30, 2025. This increase primarily reflects strategic investments to support future growth, including a significant expansion of our commercial organization through increased sales representative headcount which resulted in increased compensation costs of $4.2 million. In addition, we incurred higher marketing expenditures of $1.3 million to support the continued investment in new customer experience capabilities. The increase also reflected higher third-party consulting costs of $2.9 million, IT software and infrastructure costs of $1.4 million and occupancy costs of $0.9 million.

Previous wording

Non-operating income of $1.6 million for the three months ended June 30, 2025 primarily reflected a gain of $3.1 million for the change in the fair value of public and private warrants, partially offset by expense of $0.9 million for the change in fair value of the contingent consideration.

Current wording

Non-operating expense of $4.1 million for the three months ended September 30, 2025 primarily reflected net interest expense of $0.6 million related to the Perceptive Term Loan Facility, a loss of $0.9 million for the change in the fair value of public and private warrants, and a loss of $2.5 million for the change in fair value of the contingent consideration.

Previous wording

Total revenue increased by $11.7 million, or 11%, to $114.4 million for the three months ended June 30, 2026, from $102.7 million for the three months ended June 30, 2025.

Current wording

Total revenue increased by $33.2 million, or 11%, to $339.8 million for the nine months ended September 30, 2026, from $306.6 million for the nine months ended September 30, 2025.

Previous wording

Diagnostic test revenue increased by $11.8 million, or 12%, to $111.9 million for the three months ended June 30, 2026, from $100.1 million for the three months ended June 30, 2025. The increase primarily reflected an increase of 17% in whole exome and genome sequencing revenues driven by a 32% increase in test volumes. This was partially offset by a 12% decrease in average reimbursement rates and declines in other non-exome test revenues.

Current wording

Diagnostic test revenue increased by $33.9 million, or 11%, to $333.2 million for the nine months ended September 30, 2026, from $299.4 million for the nine months ended September 30, 2025. The increase primarily reflected an increase of 18% in whole exome and genome sequencing revenues driven by a 30% increase in test volumes, partially offset by the absence of revenue recognized in the prior-year period associated with the previously announced discontinuation of the hereditary cancer genetic testing business.

Previous wording

Other revenue decreased by $0.4 million, to $3.5 million for the six months ended June 30, 2026, from $3.9 million for the six months ended June 30, 2025. The decrease is driven by lower data deal activity in the current period compared to the prior period.

Current wording

Other revenue decreased by $0.6 million, to $6.6 million for the nine months ended September 30, 2026, from $7.2 million for the nine months ended September 30, 2025. The decrease is driven by lower software and interpretation services revenue, partially offset by an increase in revenue from our data information business.

Previous wording

Research and development expense increased by $11.8 million, or 43%, to $39.5 million for the six months ended June 30, 2026, from $27.7 million for the six months ended June 30, 2025. The increase was primarily attributable to higher compensation-related costs of $9.3 million which reflects an investment to expand our product development team. In addition, an increase in costs related to sponsored research programs of $0.8 million and an increase in software-related expenses of $1.6 million contributed to the overall increase in research and development expenses.

Current wording

Research and development expense increased by $9.3 million, or 20%, to $56.8 million for the nine months ended September 30, 2026, from $47.5 million for the nine months ended September 30, 2025. The increase was primarily attributable to higher compensation-related costs of $6.9 million, which reflects an investment to expand our product development team which includes partial offsets of capitalized software costs of $2.3 million and lower accrued employee incentive compensation in the current period of $2.8 million. In addition, an increase in software-related expenses of $2.2 million, and an increase in costs related to sponsored research programs of $0.8 million contributed to the overall increase in research and development expenses. This was partially offset by lower third-party consultant costs of $0.5 million.

Previous wording

Selling, general and administrative expense increased by $53.3 million, or 55%, to $150.6 million for the six months ended June 30, 2026, from $97.3 million for the six months ended June 30, 2025. The increase was primarily attributable to our investment to support growth in our commercial team with higher compensation-related costs of $29.5 million, higher marketing expenditures and continued investment in new customer experience capabilities. The increase reflected higher IT software and infrastructure costs of $2.9 million, third-party consulting costs of $5.9 million, marketing, travel and customer engagement expenses of $3.6 million and increased amortization expense for acquired intangible assets established in connection with purchase accounting. In addition, the prior period included a one-time sales-and-use tax refund of $8.4 million.

Current wording

Selling, general and administrative expense increased by $64.5 million, or 39%, to $229.8 million for the nine months ended September 30, 2026, from $165.3 million for the nine months ended September 30, 2025. The increase was primarily attributable to our investment to support growth in our commercial team with higher compensation-related costs of $33.7 million, higher marketing expenditures and continued investment in new customer experience capabilities. The increase reflected higher IT software and infrastructure costs of $4.3 million, third-party consulting costs of $8.8 million, marketing, travel and customer engagement expenses of $4.8 million, and higher occupancy costs of $1.4 million. In addition, the prior period included a one-time sales-and-use tax refund of $8.4 million.

Previous wording

During the first quarter of 2026, we recorded non-cash impairment charges totaling $31.3 million related to the goodwill and intangible assets associated with the Fabric Genomics acquisition. This consists of a $11.9 million goodwill impairment charge, a $10.2 million impairment of developed technology, a $5.0 million impairment of customer relationships, and a $4.2 million impairment of tradenames and trademarks. See Note 6, “Goodwill and Intangible assets” for further information.

Current wording

During the first quarter of 2026, we recorded non-cash impairment charges totaling $31.3 million related to the goodwill and intangible assets associated with the Fabric Genomics acquisition. This consists of an $11.9 million goodwill impairment charge, a $10.2 million impairment of developed technology, a $5.0 million impairment of customer relationships, and a $4.2 million impairment of tradenames and trademarks. See Note 6, “Goodwill and Intangible Assets” for further information.

Previous wording

Non-operating expense, net of $5.8 million for the six months ended June 30, 2026 primarily reflected a $6.6 million loss on extinguishment of the Perceptive long-term debt and increased interest expense of $0.4 million as a result of the Blackstone loan agreement. This was offset by a gain in the change in the fair value of warrants of $1.1 million and a gain of $1.6 million in the change in fair value of contingent consideration associated with the Fabric Genomics acquisition.

Current wording

Non-operating expense, net of $7.6 million for the nine months ended September 30, 2026 primarily reflected a $6.6 million loss on extinguishment of the Perceptive long-term debt and higher net interest expense of $1.7 million related to borrowing under the Blackstone Loan Agreement entered into during the first quarter of 2026 and subsequently amended and restated during the third quarter of 2026, resulting in aggregate borrowings of $150.0 million. These expenses were partially offset by a gain in the change in the fair value of warrants of $1.1 million and a gain of $1.6 million in the change in fair value of contingent consideration associated with the Fabric Genomics acquisition.

Previous wording

Non-operating expense, net of $0.1 million for the six months ended June 30, 2025 primarily reflected a gain in the change in fair value of warrants of $2.0 million and a realized gain on marketable securities of $0.5 million. This was offset by a loss of $0.9 million for the change in fair value of the contingent consideration and interest expense, net of $1.5 million.

Current wording

Non-operating expense, net of $4.1 million for the nine months ended September 30, 2025 primarily reflected a loss of $3.4 million for the change in fair value of the contingent consideration and interest expense, net of $2.0 million. This was partially offset by a gain in the change in fair value of warrants of $1.1 million and a realized gain on marketable securities of $0.5 million.

Previous wording

The following is a reconciliation of gross profit to our adjusted gross profit and of our gross margin to adjusted gross margin for the three and six months ended June 30, 2026 and 2025:

Current wording

The following is a reconciliation of gross profit to our adjusted gross profit and of our gross margin to adjusted gross margin for the three and nine months ended September 30, 2026 and 2025:

Previous wording

Adjusted net income (loss) is a non-GAAP financial measure that we define as net (loss) income adjusted for depreciation and amortization, stock-based compensation expenses, restructuring costs, change in fair value of financial liabilities, non-core lease costs, loss on extinguishment of debt, interest expense (net), income tax expense (benefit), transaction costs and costs related to a legal reserve. We believe adjusted net income (loss) is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain factors that may vary from company to company for reasons unrelated to overall operating performance.

Current wording

Adjusted net income is a non-GAAP financial measure that we define as net loss adjusted for depreciation and amortization, stock-based compensation expenses, restructuring costs, change in fair value of financial liabilities, interest expense (net), non-core lease costs, impairment loss, loss on extinguishment of debt, income tax expense, transaction costs, third party advisor fees related to our revenue cycle transformation and costs related to a legal reserve. We believe adjusted net income is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain factors that may vary from company to company for reasons unrelated to overall operating performance.

Previous wording

The following is a reconciliation of our net (loss) income to adjusted net income (loss) for the three and six months ended June 30, 2026 and 2025:

Current wording

The following is a reconciliation of our net loss to adjusted net income for the three and nine months ended September 30, 2026 and 2025:

Previous wording

(2)For the three and six months ended June 30, 2026, represents income tax expense, net, and costs related to certain litigation matters. For the three and six months ended June 30, 2025, represents income tax expense, net, transaction costs associated with the Merger Agreement, and a sales-and-use tax refund.

Current wording

(2)For the three and nine months ended September 30, 2026, represents income tax expense, net, costs related to certain litigation matters, and third party advisor fees related to our revenue cycle transformation. For the three and nine months ended September 30, 2025, represents income tax expense, net, transaction costs associated with the Merger Agreement, and a sales-and-use tax refund.

Previous wording

As of June 30, 2026, our existing cash and cash equivalents and available-for-sale marketable securities were $132.5 million.

Current wording

As of September 30, 2026, our existing cash and cash equivalents and available-for-sale marketable securities were $170.1 million.

Previous wording

On February 27, 2026, we entered into a Loan Agreement (the “Loan Agreement”), among Blackstone Alternative Credit Advisors LP and Blackstone Life Sciences Advisors L.L.C. (collectively referred to herein as “Blackstone”), certain of our subsidiaries party thereto as guarantors (collectively, the “Guarantors”), Wilmington Trust, National Association, as Agent and the lenders from time to time party thereto (collectively, the “Lenders”).

Current wording

On February 27, 2026, we entered into a Loan Agreement (the “Loan Agreement”), among Blackstone Alternative Credit Advisors LP and Blackstone Life Sciences Advisors L.L.C. (collectively referred to herein as “Blackstone”), certain of our subsidiaries party thereto as guarantors (collectively, the “Guarantors”), Wilmington Trust, National Association, as Agent and the lenders from time to time party thereto (collectively, the “Lenders”). The Loan Agreement provided for a term loan in an aggregate principal amount of $100.0 million (the “Term Loan”), which was funded on February 27, 2026 (the “Closing Date”). See Note 8, “Long-Term Debt” for further information.

Previous wording

Concurrently with the Amended Loan Agreement, we entered into a Securities Purchase Agreement with certain affiliates of Blackstone (collectively, the “Investors”), pursuant to which the Investors agreed to purchase approximately 81,967 shares of our Class A common stock at $61.00 per share in a private placement, for aggregate gross proceeds of approximately $5.0 million. The closing of the private placement is expected to occur substantially concurrently with the funding of the incremental term loan facility. See Note 8, “Long-Term Debt” for further information.

Current wording

Concurrently with the Amended Loan Agreement, we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain affiliates of Blackstone (collectively, the “Investors”), pursuant to which the Investors agreed to purchase 81,967 shares of our Class A common stock at $61.00 per share in a private placement, for aggregate gross proceeds of approximately $5.0 million. The closing of the private placement occurred on August 7, 2026, substantially concurrently with the funding of the incremental term loan facility. See Note 8, “Long-Term Debt” for further information.

Previous wording

There have been no material changes to our material cash requirements from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025, except for a sublease agreement for a laboratory space with future minimum lease payments of approximately $16.3 million which was entered into in the first quarter of 2026. For more information, see Note 9, “Purchase Commitments and Contingencies” included within this Quarterly Report. In addition, in the first quarter of 2026, werepaid in full all outstanding obligations under the Perceptive Term Loan Facility and subsequently entered into the Blackstone Loan Agreement for an aggregate principal amount of $100.0 million. For more information, see Note 8, “Long-term Debt” included within this Quarterly Report.

Current wording

There have been no material changes to our material cash requirements from those disclosed in our 2025 Form 10-K, except for a sublease agreement for a laboratory space with future minimum lease payments of approximately $16.3 million which was entered into in the first quarter of 2026. For more information, see Note 9, “Purchase Commitments and Contingencies” included within this Quarterly Report. In addition, in the first quarter of 2026, werepaid in full all outstanding obligations under the Perceptive Term Loan Facility and subsequently entered into the Blackstone Loan Agreement for an aggregate principal amount of $100.0 million. In the third quarter of 2026 we entered into an Amended and Restated Loan Agreement with Blackstone, to provide for an additional $50.0 million term loan facility, increasing the aggregate principal amount available under the facility to $150.0 million. The Amended Loan Agreement contains customary affirmative and negative covenants, events of default and minimum liquidity requirements, including a requirement that the Company maintain minimum liquidity of $75.0 million. For more information, see Note 8, “Long-Term Debt” included within this Quarterly Report.

Previous wording

Our critical accounting policies and estimates are described in Note 2, “Summary of Significant Accounting Policies” to our condensed consolidated financial statements, and Note 2, “Summary of Significant Accounting Policies” to the consolidated financial statements included in the 2025 Form 10-K. Other than disclosed in Note 2, there have been no material changes to our critical accounting policies and estimates in the current period.

Current wording

Our critical accounting policies and estimates are described in Note 2, “Summary of Significant Accounting Policies” to our condensed consolidated financial statements, and Note 2, “Summary of Significant Accounting Policies” to the consolidated financial statements included in the 2025 Form 10-K. Except as disclosed in Note 2, there have been no material changes to our critical accounting policies and estimates in the current period.

Previous wording

Net cash used in operating activities during the six months ended June 30, 2026 was $61.4 million, driven by a net loss of $81.1 million, net adjustments of $65.5 million and a change in operating assets and liabilities of $45.8 million. The impact of the change in operating assets and liabilities was primarily driven by decreased accounts payables and accrued expenses due to the timing of vendor payments and a decrease in other assets and liabilities due to the timing of associated payments.

Current wording

Net cash used in operating activities during the nine months ended September 30, 2026 was $72.0 million, driven by a net loss of $93.4 million, net adjustments of $81.7 million and a change in operating assets and liabilities of $60.4 million. The impact of the change in operating assets and liabilities was primarily driven by decreased accounts payables and accrued expenses due to the timing of vendor payments and a decrease in other assets and liabilities due to the timing of associated payments.

Previous wording

Net cash used in investing activities during the six months ended June 30, 2026 was $22.9 million, which included purchases of marketable securities of $29.1 million and purchases of property and equipment and development of internal-use software of $16.6 million. This was partially offset by proceeds from maturities and sales of marketable securities of $22.7 million.

Current wording

Net cash used in investing activities during the nine months ended September 30, 2026 was $30.3 million, which included purchases of marketable securities of $40.9 million and purchases of property and equipment and development of internal-use software of $21.8 million. This was partially offset by proceeds from maturities and sales of marketable securities of $32.3 million.

Previous wording

Net cash used in investing activities during the six months ended June 30, 2025 was $45.8 million, which included $33.2 million for the acquisition of Fabric Genomics, purchases of marketable securities of $30.8 million and property and equipment of $8.5 million, partially offset by $26.7 million in proceeds from the maturities of marketable securities.

Current wording

Net cash used in investing activities during the nine months ended September 30, 2025 was $50.4 million, which included $33.2 million for the acquisition of Fabric Genomics, purchases of marketable securities of $36.5 million and property and equipment of $14.7 million, partially offset by $34.0 million in proceeds from the maturities of marketable securities.

Previous wording

Net cash provided by financing activities during the six months ended June 30, 2026 was $39.6 million, which primarily reflected proceeds from long term debt, net of issuance costs, of $96.7 million and partially offset by the repayment of existing long-term debts in the amounts of $54.0 million and $4.4 million. For more information regarding our long-term debt, see Note 8, “Long-term Debt.”

Current wording

Net cash provided by financing activities during the nine months ended September 30, 2026 was $93.4 million, which primarily reflected proceeds from long term debt, net of issuance costs, of $146.0 million and proceeds from the issuance of common stock pursuant to the Purchase Agreement of $5.0 million. This was partially offset by the repayment of existing long-term debts in the amounts of $54.0 million and $4.4 million. For more information regarding our long-term debt, see Note 8, “Long-Term Debt.”

Previous wording

Net cash provided by financing activities during the six months ended June 30, 2025 was $14.1 million, which primarily reflected proceeds from the ATM offering of $13.8 million.

Current wording

Net cash provided by financing activities during the nine months ended September 30, 2025 was $24.8 million, which primarily reflected proceeds from our prior ATM offering of $25.6 million.