Natera, Inc.

What they do

Natera develops molecular assays based on massively multiplexed PCR and proprietary bioinformatics algorithms that measure small amounts of circulating DNA from blood or other samples. It processes tests at CLIA-certified laboratories in Austin, Texas and San Carlos, California, with a Boulder, Colorado lab used for clinical trials testing, and also licenses its Constellation cloud-based distribution model to partner laboratories. Customers include independent and reference laboratories, medical centers, physician practices, research laboratories and pharmaceutical companies, and the majority of revenue comes from insurers under in-network contracts.

Revenue drivers

• Oncology (Signatera, Latitude, Altera) — Signatera is a personalized ctDNA blood test for molecular residual disease assessment, recurrence monitoring and treatment response; Latitude is a tissue-free colorectal MRD test and Altera is comprehensive genomic profiling. Oncology drove 296,700 tests processed in Q2 2026, up 57.2% year over year.
• Women's health (Panorama, Horizon and others) — The company says it generates the majority of its revenue from Panorama, its non-invasive prenatal test, and Horizon, its genetic carrier screening test, supplemented by Fetal Focus, Vistara, Anora and Empower hereditary cancer screening. These are sold through a direct sales force in the U.S. and through laboratory distribution partners.
• Organ health (Prospera and related tests) — Natera offers tests to assess kidney, heart and lung transplant rejection and genetic testing for chronic kidney disease. The Q2 2026 release cites expanded Medicare coverage for Prospera as a recent milestone, but no separate revenue figure for this category is given in the excerpts.
• Constellation cloud-based licensing — Under this model, partner laboratories run the molecular workflows themselves and access Natera's bioinformatics algorithms via cloud software. Management states this yields lower revenue and gross profit per test than tests Natera processes itself, but also lower cost per test.

Recent performance

Second quarter 2026 revenue was $752.8 million, up 37.7% from $546.6 million in the second quarter of 2025. Natera processed approximately 1,043,900 tests in Q2 2026 versus 853,100 a year earlier, an increase of 22.4%, and reported results on approximately 985,500 tests. Gross margin was 64.5% versus 63.4%, and gross profit was $485.2 million versus $346.6 million; the quarter included a $52.3 million favorable change in revenue accrual estimates that added 2.7% to gross margin. The net loss narrowed to $67.0 million, or $0.47 per diluted share, from $100.9 million, or $0.74 per diluted share, in Q2 2025, and cash increased by approximately $3.6 million.

Strategy

Management's stated focus is expanding adoption of its existing tests in oncology, women's health and organ health, enhancing those products and launching new ones. The company invests in clinical evidence, citing over 350 peer-reviewed publications as of December 31, 2025, and in intellectual property, with over 650 issued or pending patents as of that date. It sells through its own U.S. direct sales force and a global network of over 100 laboratory and distribution partners, and it offers the Constellation cloud model so partner labs can run its workflows locally. Recent stated milestones include three regulatory approvals for Signatera, expanded Medicare coverage for Prospera, and a major enhancement to Panorama NIPT.

Risks

• Concentration in a few tests — Natera states that the significant majority of revenue comes from Panorama, Horizon and Signatera, so an adverse impact on any one of these tests would affect overall revenue or a component of it.
• Reimbursement and average selling price — Most revenue comes from insurers with in-network contracts based on positive coverage determinations; the company specifically notes that a decline in reimbursement rates for Horizon could lower its overall blended average selling price.
• Continued operating losses — Net loss was $208.2 million in 2025 and $67.0 million in Q2 2026, and management's risk factors state it may be challenging to achieve profitability.
• Dependence on adoption by physicians and partners — Natera cannot guarantee physicians will order its tests or that laboratory distribution partners and licensees will actively or effectively market them, which it identifies as a key uncertainty in growing revenue.

Outlook

In its August 6, 2026 release, management raised 2026 annual revenue guidance by $100 million at the midpoint, to a range of $2.85 billion to $2.91 billion from $2.74 billion to $2.82 billion. The company cited over one million tests processed for a second consecutive quarter, record oncology volume growth, Signatera regulatory approvals, expanded Medicare coverage for Prospera, and a major Panorama NIPT enhancement. No other forward guidance is provided in the excerpts.