DermTech Inc (DMTK) Reports 10% Increase in Total Revenue for Q3 2023
Test revenue for DermTech Inc (NASDAQ:DMTK) increased by 8% in Q3 2023 compared to the same period in 2022.
The Average Selling Price (ASP) for the DermTech Melanoma Test (DMT) saw a 24% year-over-year increase.
Operating expenses significantly declined in Q3 2023, with a 35% decrease in net cash burn from the full-year 2022.
The company's cash runway is projected to extend into the first quarter of 2025.
On November 2, 2023, DermTech Inc (NASDAQ:DMTK), a leader in precision dermatology, released its third-quarter 2023 financial results. The company reported a significant improvement in key performance indicators, including a growth in ASP and test revenue on a year-over-year and sequential basis. The Medicare proportion of billable samples also expanded from 23% to a record high of 27% in the last two quarters.
Financial Highlights
The company's test revenue for Q3 2023 was $3.7 million, an 8% increase from Q3 2022, primarily due to a higher ASP for the DMT. Total revenue was $3.9 million, a 10% increase from Q3 2022, driven by higher test revenue. However, the billable sample volume declined 13% from Q3 2022 to approximately 15,710.
Operating expenses saw a significant decrease in Q3 2023. Sales and marketing expenses were $8.1 million, a 44% decrease from Q3 2022, primarily due to lower employee-related and marketing expenditures. Research and development expenses were $3.6 million, a 37% decrease from Q3 2022, largely due to lower employee-related and lab supplies costs. General and administrative expenses were $8.3 million, a 6% decrease from Q3 2022, driven primarily by lower employee-related costs.
Balance Sheet and Cash Flow
As of September 30, 2023, DermTech Inc (NASDAQ:DMTK) had cash, cash equivalents, restricted cash, and short-term marketable securities amounting to $71.7 million. During Q3 2023, the company generated net proceeds of approximately $0.5 million from the issuance of 302,598 shares of common stock in at-the-market (ATM) offerings at a weighted average price of $2.55 per share. DermTech believes it should have sufficient cash resources to fund its planned operations into the first quarter of 2025.
Looking Ahead
CEO Bret Christensen expressed confidence in the company's strategy of prioritizing reimbursed tests and growing revenue. He stated,
We believe monetizing our already significant demand is the best way to reach a meaningful revenue inflection point while managing our balance sheet."
He further added that the company expects revenue to grow year-over-year in 2023.
Explore the complete 8-K earnings release (here) from DermTech Inc for further details.
This article first appeared on GuruFocus.
