The call in brief

Guardant Health delivered a landmark second quarter of 2026, with total revenue up 44% year-over-year to $335 million on broad-based strength across all three business lines. Oncology revenue grew 38% to $219 million as test volumes jumped 63% to roughly 104,000, led by Reveal (volume more than doubling), Guardant360 Liquid (up over 30%), and an accelerating Guardant360 Tissue; biopharma & data set a record at $61 million (+9%); and screening (Shield) revenue reached $53 million on ~66,000 tests, up from $15 million a year ago. The quarter brought two transformational access wins for Shield, inclusion in the American Cancer Society colorectal screening guidelines and a coverage decision from UnitedHealth, the largest U.S. commercial insurer, together bringing about 70 million lives (~60% of the market) into coverage, alongside FDA approval of Guardant360 Liquid CDx and a lower-cost, higher-throughput Shield workflow. Management raised full-year 2026 revenue guidance to $1.34-$1.36 billion (36%-38% growth), lifting both oncology (~30% revenue, ~50% volume) and screening ($218-$230 million) outlooks. Profitability remained the key watch item: the company posted a GAAP net loss of $120.1 million ($0.90 loss per share) and a $56 million adjusted EBITDA loss, and raised full-year free-cash-flow burn guidance by $10 million to $195-$205 million on accelerated screening lab investment. Non-GAAP gross margin improved to 67%, the ex-screening business is now adjusted EBITDA positive, and management reaffirmed a path to company-wide cash-flow breakeven by the end of 2027, with a pending Guardant360 ADLT rate of $8,455 a potential accelerator over the next 12-24 months.

What went well
  • Q2 2026 was a landmark quarter, with total revenue of $335 million growing 44% year-over-year on broad-based strength across oncology, biopharma & data, and screening.
  • Oncology revenue grew 38% to $219 million as test volumes rose 63% to approximately 104,000 tests, with Reveal volume more than doubling (>100% growth) and Guardant360 Liquid accelerating to over 30% growth.
  • Guardant received FDA approval for Guardant360 Liquid CDx, the only FDA-approved liquid biopsy test integrating both genomic and epigenomic content, one of the most significant regulatory milestones in the company's history.
  • Screening (Shield) revenue reached $53 million on ~66,000 tests, up from $15 million on ~16,000 tests a year ago, aided by the Quest collaboration, DTC momentum, and an expanded 400+ person field organization.
  • Two major Shield access wins landed: inclusion in the American Cancer Society colorectal screening guidelines and a coverage decision from UnitedHealth Group, the largest U.S. commercial insurer, bringing ~70 million lives (~60% of the market) into coverage.
  • Management raised full-year 2026 revenue guidance to $1.34-$1.36 billion (36%-38% growth) and lifted oncology and screening outlooks, while non-GAAP gross margin improved to 67% from 66%.
What went wrong
  • The company remained unprofitable, with a GAAP net loss of $120.1 million ($0.90 loss per share, wider than the prior-year $99.9 million loss) and an adjusted EBITDA loss of $56 million versus a $52 million loss a year ago.
  • Free cash flow burn increased to $70 million in the quarter (from $66 million) as capital expenditure rose for screening lab automation, and full-year burn guidance was raised $10 million to $195-$205 million.
  • Non-GAAP operating expenses rose 34% to $288 million, with sales and marketing jumping to $172 million from $108 million as commercial investment in screening scaled ahead of revenue.
  • Realizing higher ASPs from the UnitedHealth win and the pending Guardant360 ADLT rate ($8,455) will be slow, with management cautioning it can take 12-24 months for Medicare Advantage and commercial pricing to flow through.
  • Management tempered expectations for a repeat of Q2's exceptional sequential Shield step-up (~22,000 tests), noting the confluence of Quest, DTC, and field-force ramp effects is not expected to recur all at once in Q3.

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