OraSure Technologies Inc.

03/09/2026 | Press release | Distributed by Public on 03/09/2026 14:30

Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

Management's Discussion and Analysis of Financial Condition and Results of Operations.
Statements below regarding future events or performance are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The Company's actual results could be quite different from those expressed or implied by the forward-looking statements. Factors that could affect results are discussed more fully under the Item 1A, entitled "Risk Factors," and elsewhere in this Annual Report. Although forward-looking statements help to provide complete information about the Company, readers should keep in mind that forward-looking statements may not be reliable. Readers are cautioned not to place undue reliance on the forward-looking statements. The Company undertakes no duty to update any forward-looking statements made herein after the date of this Annual Report.
The following discussion should be read in conjunction with the consolidated financial statements contained herein and the notes thereto, along with the Section entitled "Critical Accounting Policies and Estimates," set forth below. This section of this Annual Report on Form 10-K for the year ended December 31, 2025 (this "Annual Report") generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussion of 2023 items and year-to-year comparisons between 2024 and 2023 that are not included in this Annual Report can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the year ended December 31, 2024.
Business Overview
The Company's business consists of the development, manufacture, marketing, sale and distribution of simple, easy to use diagnostic products and specimen collection devices using its proprietary technologies, as well as other diagnostic products including immunoassays and other in vitro diagnostic tests that are used on other specimen types. Our diagnostic products include tests for diseases including HIV, Hepatitis C, Syphilis, Sickle Cell and COVID-19 that are performed on a rapid basis at the point of care. These products are sold in the United States and internationally to various clinical laboratories, hospitals, clinics, community-based organizations, and other public health organizations, distributors, government agencies, physicians' offices, and commercial and industrial entities. The Company's HIV and COVID-19 products are also sold in a consumer-friendly format in the OTC market in the U.S. and, in the case of the HIV and HCV products, as a self-test to individuals in a number of other countries, including, for the HIV products, as an oral swab in-home test for HIV-1 and HIV-2 in Europe, and for the HCV products, as an OTC test. In December 2025, the Company submitted a 510(k) to the FDA for clearance of its rapid molecular self-test for CT/NG, which is currently under review.
The Company's business also includes sample management solutions and services that are used by clinical laboratories, direct-to-consumer laboratories, researchers, pharmaceutical companies, and animal health service and product providers. The revenues from sample management solutions are derived from product sales to commercial customers and sales into the academic and research markets. Customers span the disease risk management, diagnostics, pharmaceutical, biotech, and companion animal market segments. The Company has also developed collection devices for the emerging microbiome market, which focuses on studying microbiomes and their effect on human and animal health. The Company also has a urine collection device which allows for the volumetric collection of first void urine. Initial sales of this product for research use only are occurring primarily through distributors and collaborations in the liquid biopsy and sexually transmitted disease markets. In December 2025, the Company also submitted a 510(k) to the FDA for clearance of its Colli-Pee®at-home urine collection device for sexually transmitted infections, which is currently under review.
Recent Developments
Risk Assessment Testing
In the third quarter of 2024, the Company announced the discontinuance of sales of its risk assessment product line which was completed in the second quarter of 2025. Sales of its risk assessment products contributed $1.9 million and $8.4 million to revenues during the twelve months ended December 31, 2025 and 2024, respectively. During the first quarter of 2025, the Company sold certain assets that made up the risk assessment product line including certain intellectual property, contracts, permits, and equipment.
Acquisition of BioMedomics, Inc.
In November 2025, the Company acquired BioMedomics, Inc. ("BioMedomics"), pursuant to which BioMedomics became a wholly-owned subsidiary of the Company. The BioMedomics acquisition expands the Company's diagnostic portfolio by adding SickleSCAN®, a rapid, point-of-need test for sickle cell disease that is sold outside of the United States.
Results of Operations
The Company's consolidated net loss for the year ended December 31, 2025 was $68.7 million, or $0.94 per share on a fully diluted basis, compared to consolidated net loss of $19.5 million, or $0.26 per share on a fully diluted basis, for the year ended December 31, 2024.
Year ended December 31, 2025 compared to December 31, 2024.
CONSOLIDATED NET REVENUES
The table below shows a summary of total consolidated net revenues (dollars in thousands) for the years ended December 31, 2025 and 2024:
For the Years Ended December 31,
Dollars % Change Percentage of Total Net Revenues
2025 2024 2025 2024
Diagnostics (1)
$ 66,497 $ 75,917 (12) % 58 % 41 %
Sample Management Solutions (2)
38,356 51,046 (25) 33 28
Risk Assessment Testing(3)
1,866 8,354 (78) 2 4
Other products and services (4)
1,716 2,453 (30) 1 1
COVID-19 Diagnostics 620 45,136 (99) 1 24
Molecular Services - 1,705 (100) - 1
Net product and services revenues 109,055 184,611 (41) 95 99
Non-product and services revenues(5)
5,966 1,216 391 5 1
Net revenues $ 115,021 $ 185,827 (38) % 100 % 100 %
(1)Includes HIV, HCV, Syphilis, and SureQuick®product revenues.
(2)Includes Genomics, Microbiome, and Colli-Pee®product revenues.
(3)Includes substance abuse testing product revenues.
(4)Includes COVID-19 Sample Management Solutions product revenues.
(5)Includes funded research and development contracts, royalty income, and grant revenues.
Product and Services Revenues
Consolidated net revenues decreased 38% to $115.0 million for the year ended December 31, 2025 from $185.8 million for the year ended December 31, 2024.
Sales of the Company's Diagnostics products decreased 12% to $66.5 million for the year ended December 31, 2025 from $75.9 million for the year ended December 31, 2024. This decrease in revenues is largely due to lower international HIV revenues primarily driven by a decrease in funding and customer ordering patterns in Africa and Asia. Lower sales of the Company's HIV domestic products due to a decrease in overall funding impacting HIV programs also contributed to the decline in diagnostic revenues. Offsetting these decreases in revenues is an increase in Syphilis revenue resulting from the launch in the second quarter of 2024.
Sample Management Solutions revenues decreased by 25% to $38.4 million for the year ended December 31, 2025 compared to $51.0 million for the year ended December 31, 2024. Sales of the Company's Sample Management Solutions are being impacted by a large customer's bankruptcy.
Risk Assessment testing revenues decreased 78% to $1.9 million for the year ended December 31, 2025 from $8.4 million for the year ended December 31, 2024. The Company discontinued this line of business at the end of 2024 and the business wound down in early 2025.
COVID-19 Diagnostics revenues decreased 99% to $0.6 million for the year ended December 31, 2025 from $45.1 million for the year ended December 31, 2024 due to decreased sales of the Company's InteliSwab®tests through its U.S. government procurement contracts. The Company experienced a significant decline in COVID-19 revenues during 2024
due to the fulfillment of these contracts and lower overall demand for COVID-19 testing and anticipates that this trend will continue into the foreseeable future.
Molecular Services revenues, which were largely derived from the Company's microbiome molecular sequencing services, were nil for the year ended December 31, 2025 compared to $1.7 million for the year ended December 31, 2024. The decrease in services revenues was due to the decision to exit this line of business.
Non-Product and Services Revenues
Non-product and services revenues increased 391% to $6.0 million for the year ended December 31, 2025 from $1.2 million for the year ended December 31, 2024 primarily due to the recognition of revenue under funded R&D contracts that were assumed by the Company as a result of the Sherlock acquisition at the end of 2024 as well as an increase in funded R&D under other BARDA contracts.
CONSOLIDATED OPERATING RESULTS
Consolidated gross profit margin decreased to 41.9% for the year ended December 31, 2025 from 42.7% for the year ended December 31, 2024. The largest driver of the margin decline was a negative product mix driven by lower InteliSwab® sales that generate higher gross margins and lower genomics sales that also generate higher gross margins. Also contributing to the decline in margins was lower absorption of fixed overhead costs due to lower revenues and production. The termination of the microbiome molecular sequencing services business which historically dragged down the gross margin rate helped to improve the gross margin rate during the period along with the higher non-product revenues which contribute 100% to gross margin.
Consolidated operating loss for the year ended December 31, 2025 was $72.0 million, compared to a $28.3 million operating loss reported for the year ended December 31, 2024. Results for the year ended December 31, 2025 were negatively impacted by the decrease in revenues, lower gross margins earned on the revenues and by higher operating expenses. Results for the year ended December 31, 2025 included change in the estimated fair value of acquisition-related contingent consideration of $4.6 million offset by gain on sale of assets of $0.7 million. Results for the year ended December 31, 2024 included impairment charges of $4.4 million.
Research and development expenses increased 63% to $42.5 million for the year ended December 31, 2025 from $26.0 million for the year ended December 31, 2024 largely due to higher spend incurred for clinical trials for the CT/NG device and additional research and development operational expense layered in from the acquired Sherlock companies.
Sales and marketing expenses decreased 16% to $26.1 million for the year ended December 31, 2025 from $31.0 million for the year ended December 31, 2024 primarily due to decreased employee costs associated with a reduction in headcount, and lower market research and advertising spend.
General and administrative expenses increased 3% to $47.7 million for the year ended December 31, 2025 from $46.2 million for the year ended December 31, 2024 largely due to higher legal fees relating to the NowDx litigation (discussed further in Note 14, Commitments and Contingencies, to the consolidated financial statements included herein) and costs associated with the Sherlock acquisition. Also contributing to the increase were additional general and administrative expenses layered in from the acquired Sherlock companies which occurred in December 2024. Lower stock compensation expense, consulting fees, and decreased employee costs partially offset the increase in general and administrative spend.
All of the above contributed to the Company's operating loss of $72.0 million for the year ended December 31, 2025, which included non-cash charges of $10.2 million for depreciation and amortization, $10.1 million for stock-based compensation, and $4.6 million for change in the estimated fair value of acquisition-related contingent consideration. The Company's operating loss of $28.3 million for the year ended December 31, 2024 included a non-cash charge of $11.9 million for stock-based compensation, $10.9 million for depreciation and amortization, and impairment charges of $4.4 million.
CONSOLIDATED OTHER INCOME
Other income for the year ended December 31, 2025 was $7.4 million compared to $12.2 million for the year ended December 31, 2024. The decrease in other income is primarily due to lower interest income and lower foreign currency gains.
CONSOLIDATED INCOME TAXES
The Company continues to believe the full valuation allowance established against its total U.S. deferred tax asset is appropriate as the facts and circumstances necessitating the allowance have not changed. The Company has not achieved U.S. cumulative pre-tax earnings based on a rolling three year window as the Company has not achieved a level of sustained profitability that would, in its judgment, support the release of the valuation allowance. For the years ended December 31, 2025 and 2024, the Company recorded income tax expense of $1.8 million.
Liquidity and Capital Resources
December 31, 2025 December 31, 2024
(in thousands)
Cash and cash equivalents $ 199,278 $ 267,763
Working capital 222,113 299,737
The Company's cash and cash equivalents decreased to $199.3 million at December 31, 2025 from $267.8 million at December 31, 2024. The Company has $86.9 million, or 44% of its $199.3 million of cash, cash equivalents and available-for-sale securities held by DNAG, the Company's Canadian subsidiary.
The Company's working capital decreased to $222.1 million at December 31, 2025 from $299.7 million at December 31, 2024. Working capital is primarily a function of sales, purchase volumes, inventory requirements, and vendor payment terms.
Analysis of the Company's Cash Flows
Operating Activities
During the year ended December 31, 2025, net cash used in operating activities was $49.0 million. Cash flows from operations can be significantly impacted by factors such as timing of receipts from customers, inventory purchases, and payments to vendors. The Company's net loss of $68.7 million included non-cash charges of depreciation and amortization expense of $10.2 million, stock-based compensation expense of $10.1 million, change in estimated fair value of acquisition-related contingent consideration of $4.6 million, a loss on equity investment of $2.3 million, and other non-cash charges aggregating to $1.2 million.
Cash used by the Company's working capital accounts included a decrease in accrued expenses and other liabilities of $8.7 million largely attributable to lower bonus accruals, an increase in prepaid expenses and other assets of $2.4 million associated with an increase in the Company's Canadian income tax receivable and increased prepayment of costs associated with the Company's efforts to prepare for production of the CT/NG device, a decrease of $1.7 million in accounts payable, and a decrease in deferred revenue of $1.5 million as work on grant projects is completed and earned. Offsetting these uses of cash is a decrease in inventory balances of $3.6 million related to the discontinuance of sales of the Company's Risk Assessment products and lower demand for its InteliSwab® COVID-19 Rapid test, and a decrease in accounts receivable of $1.9 million as the Company experienced a decline in overall sales.
Investing Activities
Net cash used in investing activities was $6.8 million for the year ended December 31, 2025, associated with proceeds from sale of property and equipment offset by the acquisition of new property and equipment. Investing activities also includes $3.6 million of cash used for the acquisition of BioMedomics.
Financing Activities
Net cash used in financing activities was $16.9 million for the year ended December 31, 2025, which was largely comprised of $15.0 million to repurchase common stock pursuant to the Company's stock repurchase plan and $1.8 million used for the repurchase of common stock to satisfy withholding taxes related to the vesting of restricted stock awarded to the Company's employees.
Resources
The Company's contractual obligations are included in Note 14 of its consolidated financial statements. The Company expects existing cash and cash equivalents will be sufficient to fund its operating expenses and capital expenditure requirements over the next twelve months. The Company's cash requirements, however, may vary materially from those now planned due to many factors, including, but not limited to, the scope and timing of future strategic acquisitions, the progress of its research and development programs, the scope and results of clinical testing, the cost of any future litigation, the magnitude of capital expenditures, changes in existing and potential relationships with business partners, the timing and cost of obtaining regulatory approvals, the timing and cost of future stock purchases, the costs involved in obtaining and enforcing patents, proprietary rights and any necessary licenses, the cost and timing of expansion of sales and marketing activities, market acceptance of new products, competing technological and market developments, the impact of the current economic environment and other factors.
Critical Accounting Policies and Estimates
This Management's Discussion and Analysis of Financial Condition and Results of Operations discusses the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires that the Company make judgments and estimates that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The Company bases its judgments and estimates on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
The Company's significant accounting policies are described in Note 2 of the notes to the consolidated financial statements included in Item 15 of this Annual Report. The Company considers the following accounting policies, which have been discussed with its Audit Committee, to be most critical in understanding the more complex judgments that are involved in preparing its financial statements and the uncertainties that could impact its results of operations, financial condition, and cash flows.
Revenue Recognition
Product sales
Revenue from product sales is recognized upon transfer of control of a product to a customer based on an amount that reflects the consideration the Company is entitled to, net of allowances for any discounts or rebates.
The Company generally does not grant product return rights to its customers, except for warranty returns and return rights on sales of its OraQuick®HIV Self-Test to the retail trade, and InteliSwab®products to the retail trade and certain other customers.
Historically, returns arising from warranty issues have been infrequent and immaterial. Accordingly, the Company expenses warranty returns as incurred.
The Company records shipping and handling charges billed to the Company's customers as product revenue and the related expense as cost of products sold.
Service revenues
Service revenues represent microbiome laboratory testing and analytical services. The Company recognizes revenues when it satisfies its performance obligations for services rendered. Service revenue was discontinued with the closure of the molecular services line of business in 2024.
Arrangements with multiple-performance obligations
In arrangements involving more than one performance obligation, which largely applies to the Company's service revenue stream, each required performance obligation is evaluated to determine whether it qualifies as a distinct performance obligation based on whether (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available and (ii) the good or service is separately identifiable from other promises in the contract.
The consideration under the arrangement is then allocated to each separate distinct performance obligation based on each respective relative stand-alone selling price. The estimated selling price of each deliverable is determined using an observable cost plus margin approach. The consideration allocated to each distinct performance obligation is recognized as revenue when control is transferred for the related goods or services or when the performance obligation has been satisfied.
Inventories
The Company's inventories are stated at the lower of cost or net realizable value, with cost determined on an average cost method, and include the cost of raw materials, labor and overhead. The majority of the Company's inventories are subject to expiration dating, which can be extended in certain circumstances. The Company continually evaluates quantities on hand and the carrying value of its inventories to determine the need for net realizable value adjustments for excess and obsolete inventories, based primarily on prior experience with consideration of expected changes in the business and estimated forecasts of product sales. The Company reserves for inventory expiring within ninety days, with the exception of inventory that will be consumed or will have expiration dates extended. It also considers items identified through specific identification procedures in assessing the adequacy of its reserve. Although the Company makes every effort to ensure the accuracy of its forecasts of future product demand, any significant unanticipated changes in demand could have a significant impact on the carrying value of its inventories and reported operating results.
Goodwill
Goodwill is not amortized, but rather is tested annually for impairment or more frequently if the Company believes that indicators of impairment exist. Current generally accepted accounting principles permit the Company to make a qualitative evaluation about the likelihood of goodwill impairment and if it is determined that it is more likely than not that the fair value does not exceed the carrying amount, then a quantitative test is performed. The quantitative goodwill impairment test involves a comparison of the estimated fair value of the reporting unit to the respective carrying amount. An impairment charge is recognized in the amount by which the carrying amount exceeds the reporting unit's fair value, provided the impairment charge does not exceed the total amount of goodwill allocated to the reporting unit.
The process of evaluating the potential impairment of goodwill is highly subjective and requires significant judgment, including the identification of reporting units, qualitative evaluation of events and circumstances to determine if it is more likely than not that an impairment exists, and, if necessary, the estimation of the fair value of the applicable reporting unit.
The Company performed its annual goodwill impairment analysis and noted there were impairment indicators. A quantitative impairment test was performed on both reporting units. Both reporting units showed fair value exceeded carrying value. The diagnostic reporting unit impairment results reflected a fair value with a narrower margin to its carrying value. As of November 30, 2025, the annual impairment testing date, the diagnostic reporting unit fair value exceeded the carrying value by 13%. As of December 31, 2025, the diagnostic reporting unit had $8.2 million of goodwill. The diagnostic reporting unit goodwill impairment analysis used both an income and market approach. These two approaches were weighted and the income approach was weighed more than the market approach. Key assumptions included estimates of revenues increasing each year as new products are launched and a weighted-average cost of capital based on guideline companies. The revenue and cashflows forecasts assume products are passed by regulatory bodies on a set timeline and market competition of future products is low. The revenues assume market growth will accelerate each year. If there are delays to attaining regulatory approval or successfully launching products, this could have a negative outcome on the goodwill impairment analysis. In addition, if the Company's weighted-average cost of capital is not aligned with guideline companies, this could negatively affect the goodwill impairment outcome.
Business Combinations and Contingent Consideration
Acquired businesses are accounted for using the acquisition method of accounting, which requires that the purchase price be allocated to the net assets acquired at their respective fair values. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Amounts allocated to contingent consideration are recorded to the balance sheet at the date of acquisition based on their relative fair values. The purchase price allocation requires us to make significant estimates and assumptions, especially at the acquisition date, with respect to intangible assets. Although we believe the assumptions and estimates we have made are reasonable, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain.
We account for contingent consideration in accordance with applicable guidance provided within the business combination accounting guidance. As part of our consideration for the Sherlock acquisition, we are contractually obligated to pay
certain consideration resulting from the outcome of future events. Therefore, we are required to update our underlying assumptions each reporting period, based on new developments, and record such contingent consideration liabilities at fair value until the contingency is resolved. Changes in the fair value of the contingent consideration liabilities are recognized each reporting period and included in our consolidated statements of operations. Our estimates of fair value are based on assumptions we believe to be reasonable, but the assumptions are uncertain and involve significant judgment by management. Updates to these assumptions could have a significant impact on our results of operations in any given period and any updates to the fair value of the contingent consideration could differ materially from the previous estimates.
Examples of critical estimates used in valuing the intangible asset and contingent consideration include:
• future expected cash flows from sales and acquired in-process and research developed technologies;
• the probability of meeting the future events; and
• discount rates used to determine the present value of estimated future cash flows.
These estimates are inherently uncertain and unpredictable, and if different estimates were used the purchase price for the acquisition could be allocated to the acquired assets and liabilities differently from the allocation that we have made. In addition, unanticipated events and circumstances may occur, which may affect the accuracy or validity of such estimates, and if such events occur we may be required to record a charge against the value ascribed to an acquired asset or an increase in the amounts recorded for assumed liabilities.
OraSure Technologies Inc. published this content on March 09, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on March 09, 2026 at 20:30 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]