Veracyte, Inc. (VCYT): Business Model Canvas [Dec-2025 Updated]

You're digging into how Veracyte, Inc. (VCYT) actually makes its money, and after two decades analyzing health tech, I can tell you their model hinges on generating high-value, actionable genomic insights-think guiding prostate care with Decipher or reducing unnecessary thyroid surgery with Afirma. Based on their projected $484 million to $487 million revenue for 2025 and a solid $366.4 million cash position as of Q3 2025, their strategy is clear: build durable reimbursement by generating rock-solid clinical evidence. Forget the jargon; here is the nine-block breakdown showing exactly how they turn proprietary data and specialized talent into revenue streams, so you can see the risks and opportunities clearly.

Veracyte, Inc. (VCYT) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Veracyte, Inc. (VCYT) relies on to get its genomic tests into the hands of clinicians and researchers. These aren't just handshake agreements; they are critical operational and financial links.

Biopharmaceutical companies for test development and commercialization

Veracyte, Inc. (VCYT) partners with biopharmaceutical entities by providing vitro diagnostics (IVD) services, which include manufacturing, quality control, assay and process transfer, and supply chain support. Revenue from these collaborations is categorized under Biopharmaceutical and other revenue.

Financial data for this segment shows activity:

• Biopharmaceutical and other revenue was $3.6 million in the first quarter of 2025.
• This revenue increased to $4.3 million in the second quarter of 2025.
• For the third quarter of 2025, this revenue was $0.8 million, following the restructuring and liquidation proceedings of its French subsidiary, Veracyte SAS.

Healthcare providers, hospitals, and clinics for test adoption

Adoption by healthcare providers is best tracked through the volume of Veracyte, Inc. (VCYT)'s core tests, Decipher and Afirma. The company noted its eleventh consecutive quarter of 20% or more testing volume growth starting 2025.

Here's a look at the volume growth for the key tests driving provider adoption through the first three quarters of 2025:

Management believes the Decipher test holds approximately 65% market share and is the only test available across the entire risk spectrum from localized to metastatic prostate cancer as of Q2 2025.

Helix for offering whole exome-based hereditary cancer testing with Decipher

Veracyte, Inc. (VCYT) entered a partnership with Helix to integrate Helix's whole-exome based hereditary cancer test with the Decipher Prostate test. This is designed to offer providers a single workflow for ordering both tumor testing and germline predisposition testing, which is recommended by National Comprehensive Cancer Network (NCCN) guidelines for certain prostate cancer patients.

This strategic partnership is considered pivotal for Veracyte, Inc. (VCYT)'s growth, as noted in September 2025.

Research institutions and academia for clinical validation and innovation

Clinical validation and evidence generation are key to reinforcing test value and driving reimbursement. Partnerships with research bodies facilitate this.

Concrete examples of recent validation efforts include:

• Enrollment completion for the Nightingale study, involving 2,400 patients, for the Percepta test.
• Presentation of nine Decipher-focused abstracts at the ASTRO 2025 conference, including validation data from the BALANCE trial.

Contract manufacturers for Prosigna test supply continuity

Following the decision to no longer fund its French subsidiary, Veracyte SAS, which handled some IVD manufacturing, Veracyte, Inc. (VCYT) pivoted to U.S. contract manufacturers to secure supply continuity for the Prosigna test. The company stated it was focused on maintaining customer contract manufacturing and Prosigna supply during the French entity's proceedings, which management expected to complete by the end of 2025. The U.S. launch of Prosigna as a Laboratory Developed Test (LDT) is targeted for mid-2026.

The transition to U.S. manufacturing is framed as a move to eliminate supply chain vulnerabilities and ensure long-term scalability.

Veracyte, Inc. (VCYT) - Canvas Business Model: Key Activities

You're looking at the engine room of Veracyte, Inc. (VCYT) right now, focusing on what they actually do to generate revenue and build value as of late 2025. It all centers on high-throughput, high-value genomic testing, backed by serious data generation.

Developing and commercializing genomic diagnostic tests (Afirma, Decipher)

The core activity is driving volume and revenue through the established genomic tests. For the third quarter ended September 30, 2025, the numbers show solid growth across the board, which is what management is banking on for their raised full-year guidance.

Here's the quick math on the key testing franchises for Q3 2025:

This performance led Veracyte, Inc. (VCYT) to raise its full-year 2025 testing revenue guidance to a range of $484 million to $487 million, implying year-over-year growth of 16%. Overall, total revenue for Q3 2025 hit $131.9 million.

Generating high-quality clinical evidence for reimbursement and guidelines

This activity is non-negotiable for durable revenue; it's about proving the test's value so payers cover it and clinical bodies recommend it. Veracyte, Inc. (VCYT) is actively pushing data to reinforce market leadership.

• Presented nine Decipher-focused abstracts at ASTRO 2025.
• Released first validation data from the BALANCE trial, showing the PAM50 molecular signature predicts hormone therapy benefit in men with recurrent prostate cancer using Decipher GRID.
• The company's mission includes generating high-quality evidence to drive durable reimbursement and guideline inclusion.

Advancing the TrueMRD platform for minimal residual disease testing

This is the near-term pipeline catalyst. The whole-genome sequencing (WGS)-based platform is designed for fast, accurate detection of residual disease, requiring less blood (just one tube, less than 4ml plasma).

The plan is concrete:

• Launch the first minimal residual disease (MRD) test in muscle-invasive bladder cancer in the first half of 2026.
• Data from the TOMBOLA trial showed the WGS-based platform detected recurrence a median of 93 days sooner than imaging.
• The company is also preparing for the Prosigna Laboratory Developed Test (LDT) launch, which is slated for mid-2026.

Operating and scaling the CLIA-certified diagnostic laboratories

This is the operational backbone that processes the tests. Veracyte, Inc. (VCYT) runs its diagnostics from certified labs across the US, ensuring quality control and regulatory compliance are maintained while scaling throughput to meet demand.

The physical footprint supporting this key activity includes certified labs in locations such as:

• San Francisco, CA (CLIA numbers 05D2014120, 05D2055897, 45D2052137).
• San Diego, CA.
• Austin, TX.

The company is focused on lab efficiency improvements, which contributed to raising the adjusted EBITDA margin guidance for 2025 to 22.5% (up from 21.6% in Q1 2025). The non-GAAP gross margin was reported at 72% in Q1 2025, and the Q3 2025 adjusted EBITDA margin reached 30.1% of revenue.

Bioinformatic and AI-driven analysis of genomic data

This activity is what powers the differentiation of the tests. It involves applying sophisticated computation to the genomic data generated from the tests.

The Veracyte Diagnostics Platform uses this capability to:

• Develop an in silico patient-specific signature using proprietary computation and AI methods.
• Apply AI pattern recognition and whole-genome sequencing for fast and accurate detection of residual disease.
• This data-centric approach supports continued innovation and pipeline development.

The company generated $44.8 million of cash from operations in the first nine months of 2025, ending Q3 with $366.4 million in cash, cash equivalents, and short-term investments. Finance: draft 13-week cash view by Friday.

Veracyte, Inc. (VCYT) - Canvas Business Model: Key Resources

The Key Resources for Veracyte, Inc. are centered on its intellectual property, proprietary technology, and the massive, growing datasets that fuel its AI-driven diagnostics.

Financial Capital:

Veracyte, Inc. maintains a strong balance sheet position, which is a critical resource for funding R&D and commercial expansion. As of September 30, 2025, the company reported $366.4 million of cash, cash equivalents, and short-term investments.

This liquidity supports operations, which generated $44.8 million of cash from operations in the third quarter of 2025.

Proprietary Data Assets for AI Development:

The broad genomic and clinical data assets, specifically the Decipher GRID and Afirma GRID databases, are foundational for developing and refining the company's AI and bioinformatic capabilities. These databases are continuously growing, providing a competitive moat.

The following table details the scale of these genomic resources as of late 2025:

Proprietary Technology and Intellectual Property:

The core technology is the Proprietary Veracyte Diagnostics Platform, which delivers high-performing cancer tests. This platform is fueled by deep bioinformatic and AI capabilities, which in turn drive durable reimbursement and guideline inclusion for the tests.

The output of this platform is evidenced by commercial performance. For the three months ended September 30, 2025, Veracyte, Inc. grew total volume by 18% to 45,888 tests, with testing volume increasing by 19% to 43,679 tests.

The company's gross margin stood at 68.3% as of Q3 2025, reflecting the high-value nature of its proprietary assays.

Key elements protected by intellectual property include:

• The 22-gene test for Decipher Prostate, which uses RNA whole-transcriptome analysis and machine learning.
• The technology underpinning the Afirma Genomic Sequencing Classifier (GSC).
• The development pipeline, including the whole genome-based TrueMRD platform.

Human Capital:

The ability to manage and interpret these large datasets requires a highly specialized R&D and bioinformatic talent pool. This talent is essential for generating the clinical evidence that reinforces test value. The company is also focused on executing the launch of new tests like TrueMRD and Prosigna LDT, which demands specialized commercial and scientific expertise.

The company's overall profitability reflects this resource efficiency, with an adjusted EBITDA margin of 30.1% for Q3 2025.

Veracyte, Inc. (VCYT) - Canvas Business Model: Value Propositions

You're looking at the core reasons why clinicians and payers value Veracyte, Inc.'s portfolio as of late 2025. It's all about delivering high-value, actionable genomic insights right when a patient's care path needs direction.

The scale of this value proposition is reflected in the company's financial performance, showing strong adoption across the portfolio. For the three months ended September 30, 2025, Veracyte grew total revenue by 14% year-over-year to $131.9 million, with testing revenue specifically increasing by 17% to $127.8 million. The company raised its full-year 2025 testing revenue guidance to between $484 million and $487 million, implying 16% year-over-year growth.

Here's a quick look at the Q3 2025 testing revenue breakdown:

The value proposition centers on providing clarity at pivotal moments in cancer care, helping to guide and assure patients.

Reducing unnecessary invasive procedures (e.g., Afirma for thyroid nodules)

• Afirma Genomic Sequencing Classifier (GSC) helps rule out malignancy in indeterminate thyroid nodules (ITN), which historically had a risk of malignancy (ROM) of about 25%.
• A Benign Call Rate (BCR) of 63% was observed in one real-world outcomes study for Afirma GSC Benign results.
• A published meta-analysis of 13 independent studies showed the Afirma GSC achieved a 97% sensitivity and a 99% Negative Predictive Value (NPV).
• The 65% Benign Call Rate suggests the test helped nearly two-thirds of patients with benign nodules potentially avoid diagnostic surgery.

Offering prognostic and predictive risk assessment (e.g., Decipher Prostate)

The Decipher Prostate Genomic Classifier offers deep prognostic and predictive insights across the prostate cancer spectrum. Its performance has been demonstrated in over 90 studies involving more than 200,000 patients.

• For localized or regional prostate cancer, the score indicates risk of metastasis, helping determine treatment timing and intensity.
• The test is the only gene expression test to achieve "Level I" evidence status and inclusion in the most recent NCCN Guidelines for prostate cancer.
• For metastatic prostate cancer patients, the expanded-use version became available in the US in June 2025.
• In metastatic patients with high Decipher scores and PTEN inactive tumors, adding docetaxel resulted in a 45% reduction in the hazards of death.

Expanding cancer care continuum with minimal residual disease (MRD) testing

Veracyte is actively building out its MRD platform to serve more of the patient journey, differentiating its approach by being whole genome sequencing every step of the way. This strategy is designed to drive more clinical evidence and payer coverage. The company has made good progress advancing its MRD platform for its first indication, muscle-invasive bladder cancer (MIBC).

• The MRD platform was selected for the important UMBRELLA trial, which includes non-small cell lung cancer, colorectal cancer, soft tissue sarcoma, and pancreatic cancer.
• The company submitted its technology assessment to MolDx in March.
• Commercial launch for MIBC is on track for the first half of 2026, contingent upon securing reimbursement.

Driving durable reimbursement and guideline inclusion for tests

The Veracyte Diagnostics Platform is fueled by an evidence-generation engine specifically designed to support durable adoption through reimbursement and guideline inclusion. The Decipher Prostate test's inclusion in the NCCN Guidelines is a prime example of this success. Furthermore, for Afirma, the test is covered by Medicare and most private payers, making it a covered benefit for approximately 275 million people. If onboarding takes 14+ days, churn risk rises, which is why speed to coverage is defintely critical for new tests like the upcoming MRD offering.

Finance: draft 13-week cash view by Friday.

Veracyte, Inc. (VCYT) - Canvas Business Model: Customer Relationships

You're looking at how Veracyte, Inc. builds and maintains its connections with the clinicians and institutions that use its genomic tests. It's a relationship built on data, access, and proving clinical utility at every step.

Direct sales and clinical support to physicians and institutions is the backbone here. Veracyte's commercial operations rely on a dedicated field sales force to engage directly with providers. This direct engagement supports the ordering of their complex genomic tests. For instance, in the second quarter of 2025, total testing volume reached 42,441 tests, with Decipher volume alone hitting approximately 25,500 tests. By the third quarter of 2025, total volume grew to 45,888 tests.

Evidence-based relationship building is key to securing guideline inclusion. The company emphasizes its 'powerful evidence-generation engine' to drive this adoption. For the Decipher Prostate test, management has guided that they think these tests can get to 80% market penetration. The evidence base includes the fact that Decipher already has NCCN guideline recommendation.

The commitment to evidence is seen in their clinical studies. The NIGHTINGALE clinical utility trial for the Percepta Nasal Swab Lung Cancer Test completed enrollment with 2,400 patients across over 90 centers in the U.S.. This is part of a broader effort, with over a dozen ongoing prospective trials supporting the Decipher franchise.

A dedicated payer relations team works to secure reimbursement coverage, which the company views as directly driven by clinical evidence. For the Decipher metastatic indication, two-thirds of that population is Medicare-covered. The company is making good progress toward launching its Minimal Residual Disease (MRD) platform, having received feedback on the MolDx tech assessment in March, with a launch targeted for the first half of '26.

High-touch support is necessary for complex genomic test ordering and results interpretation. This is supported by the sales force and clinical expertise. The company is also focused on advancing its pipeline, which requires close collaboration with ordering physicians for new tests. For example, the Prosigna LDT launch is targeted for mid-2026.

Here's a quick look at the recent volume and trial metrics that underpin these relationships:

The relationship strategy involves several key areas of focus for future adoption:

• Advance the MRD platform for muscle invasive bladder cancer launch in H1 '26.
• Generate data from the OPTIMA trial to support Prosigna adoption.
• Targeting a sustained annual Decipher volume trajectory to exceed 100,000 tests in 2025.
• Anticipate realizing gross margin benefits from Afirma v2 fully in 2026.

If onboarding for new institutional partners takes longer than expected, the sales cycle definitely extends. Finance: draft 13-week cash view by Friday.

Veracyte, Inc. (VCYT) - Canvas Business Model: Channels

You're looking at how Veracyte, Inc. gets its high-value cancer insights into the hands of the physicians who need them most. The channel strategy is built around a direct commercial engine supported by centralized, high-throughput laboratory infrastructure.

Direct sales force targeting oncologists, urologists, and endocrinologists

The core of the go-to-market strategy relies on a specialized, direct sales team. While the exact headcount isn't public, the entire organization supporting this effort stood at 824 total employees as of late 2025. This team drives adoption for key franchises like Decipher Prostate, which saw its volume grow 26% year-over-year to approximately 26,700 tests in the third quarter of 2025. The sales execution is critical, as management noted that Decipher took more share than expected in the market.

Centralized CLIA-certified laboratories for test processing

All test processing flows through centralized, CLIA-certified laboratories. This centralization supports quality control and scale. In the third quarter of 2025, the total testing volume processed across all platforms reached 43,679 tests. The Afirma test, which targets endocrinologists, contributed approximately 17,000 tests to that total volume in the same period. The company is focused on margin improvement, with testing gross margin reaching 73.9% in Q2 2025.

Digital platforms for physician ordering and result delivery

The Veracyte Diagnostics Platform integrates ordering and result delivery digitally, which is essential for efficiency across the entire installed base of ordering providers. The company is focused on expanding its digital pathology and AI capabilities, which complement the molecular data delivered through these platforms. The platform fuels the delivery of testing revenue, which hit $127.8 million in the third quarter of 2025.

Strategic commercial channels for international Prosigna distribution

International distribution channels are currently in a transition phase, with a focus on the U.S. launch of a Laboratory Developed Test (LDT) version of Prosigna. The U.S. Prosigna LDT launch is planned for mid-2026. This is a key future channel for breast cancer indications, aiming to serve approximately 225,000 eligible patients annually once launched. The company completed the sale and deconsolidation of its French subsidiary (Veracyte SAS) operations in 2025, which previously handled some product manufacturing and distribution.

Direct-to-physician marketing and educational outreach

Direct outreach is supported by significant investment in sales and marketing, which is used to reinforce clinical utility and drive adoption. Sales and marketing expenses were $22.4 million in the third quarter of 2025, an increase from $22.5 million in the first quarter of 2025, supporting the growth of Decipher and Afirma. Educational outreach includes presenting clinical data at major medical congresses, such as presenting nine Decipher-focused abstracts at ASTRO 2025. The sales reps are trained to have meaningful and educational discussions during practice visits.

Here's a quick look at the key volume and revenue metrics driving these channels in Q3 2025:

The channel execution is clearly driving top-line results, with testing revenue growing 17% year-over-year to $127.8 million in Q3 2025.

The key activities supporting these channels include:

• Reinforcing Decipher utility in metastatic prostate cancer.
• Advancing Afirma onto the V2 transcriptome for future ASP benefits.
• Planning for the launch of the TrueMRD platform in H1 2026.
• Investing in personnel costs within the sales and marketing function.

Finance: review Q4 Sales & Marketing budget against Q3 actuals by next Tuesday.

Veracyte, Inc. (VCYT) - Canvas Business Model: Customer Segments

You're looking at the core groups that drive Veracyte, Inc.'s revenue engine as of late 2025. These segments are the ones whose clinical decisions are directly influenced by the genomic insights from tests like Decipher and Afirma. The financial performance in the third quarter of 2025 clearly shows where the volume and revenue are concentrated.

The primary customer base is clinical, centered around specialists managing cancer and endocrine conditions. The revenue split for the third quarter ended September 30, 2025, gives you a clear picture of the current focus:

• Decipher revenue (Urologic Cancers): $82.2 million
• Afirma revenue (Thyroid): $43.2 million
• Total Testing Revenue for Q3 2025: $127.8 million

Here's a breakdown of the specific customer groups and the supporting data points we see from the latest reporting:

Oncologists and Urologists treating prostate and breast cancer

This segment is heavily driven by the Decipher Prostate Genomic Classifier, which is now the only gene expression test covered by Medicare to inform treatment decisions across the full continuum of prostate cancer risk, including the newly expanded metastatic indication available since June 2025. Prostate cancer remains a major focus, being the second-leading cause of cancer deaths among men in the United States.

The numbers for this group in Q3 2025 were strong:

Endocrinologists and Surgeons managing thyroid nodules

The Afirma test is the workhorse for this segment, helping to avoid unnecessary surgeries for thyroid nodules. While Decipher is growing faster, Afirma still contributes significantly to the top line. The operational transition to the v2 transcriptome workflow is on track for completion by year-end 2025, which should help maintain utilization.

For the third quarter of 2025, the performance was:

• Afirma revenue reached $43.2 million.
• Afirma volume grew by 13% year-over-year, with approximately 17,000 tests delivered.

Pulmonologists and Thoracic Surgeons (for lung cancer/IPF diagnostics)

While the specific revenue breakdown for lung cancer/IPF diagnostics isn't itemized separately in the latest reports like Decipher and Afirma, these indications are part of the overall testing revenue base. Veracyte's portfolio supports patient care across thyroid, prostate, bladder, breast, and lung cancers. The overall testing revenue growth of 17% year-over-year in Q3 2025 indicates broad portfolio strength, which includes these specialists.

Biopharmaceutical companies for companion diagnostic development

This segment represents a strategic, though smaller, revenue stream that validates the platform's utility for drug development. Biopharmaceutical and other revenue for Q3 2025 was $0.8 million. This is down from $4.3 million in Q2 2025, partly due to the restructuring of Veracyte SAS. However, the underlying data asset is massive: the Decipher GRID research tool contains more than 200,000 whole-transcriptome profiles from patients with urologic cancers, which is used by Veracyte and its partners for research and advancing understanding.

Health systems and payers seeking cost-effective, precise diagnostics

This group is critical for reimbursement and guideline inclusion, which underpins the entire business. The clinical rigor supporting the tests is a key selling point to these entities. For instance, the Decipher Prostate test has achieved "Level 1B" evidence status and inclusion in the risk-stratification table in the most recent NCCN® Guidelines for prostate cancer. The company is focused on durable reimbursement, which supports the overall testing revenue guidance for full-year 2025 of $484 million to $487 million. The Q3 2025 adjusted EBITDA margin of 30.1% demonstrates the cost-effectiveness of the operating model supporting these high-value diagnostics.

Veracyte, Inc. (VCYT) - Canvas Business Model: Cost Structure

You're looking at the expense side of the ledger for Veracyte, Inc. as of late 2025, focusing on what it costs to run the lab, drive sales, and develop the next generation of tests. It's a mix of direct costs tied to volume and fixed costs for growth initiatives.

Non-GAAP operating expenses for the third quarter of 2025 were reported at $58.6 million. This figure excludes certain non-cash or non-recurring items to show the core operational spend. Non-GAAP operating expenses grew just 2 percent year-over-year from $57.6 million in Q3 2024.

The Cost of testing revenue, which covers lab operations, reagents, and personnel directly involved in running the tests, saw an increase in absolute dollars. For the three months ended September 30, 2025, the GAAP cost of testing revenue was $33,777 thousand. This contrasts with the total testing revenue of $127.8 million for the same period.

Investment in Research and Development (R&D) is a key area, though the deconsolidation of Veracyte SAS impacted the reported figures. Compared to the prior year, GAAP research and development expenses decreased by $2 million, coming in at $14 million for Q3 2025. This spending fuels the evidence generation that reinforces the value of their existing tests and supports pipeline development, such as the path to the TrueMRD launch in the first half of 2026.

Sales, General, and Administrative (SG&A) expenses, which are critical for commercialization efforts, showed an increase in the sales component. Specifically, sales and marketing expenses rose by $1.5 million to reach $22.4 million in Q3 2025, attributed to higher personnel costs supporting the Decipher and Afirma tests.

Costs associated with clinical evidence generation and regulatory compliance are embedded within the operating expenses, particularly R&D and SG&A. Veracyte highlighted key activities in Q3 2025, including presenting nine Decipher-focused abstracts at ASTRO 2025, announcing STAMPEDE trial data in Cell, and completing enrollment for the NIGHTINGALE clinical utility trial. These activities represent ongoing investment in validating the clinical utility of their portfolio.

Here's a quick look at some of the key expense and margin figures from Q3 2025:

The company is managing its cost base effectively, as evidenced by the Non-GAAP gross margin reaching 73% in Q3 2025, an improvement of about 150 basis points compared to the prior year period. This efficiency helped drive the adjusted EBITDA margin to a record 30.1% for the quarter.

You should track the timing of project spend, as management noted that Q4 2025 investments are planned, which could affect sequential operating expense comparisons.

Finance: draft 13-week cash view by Friday.

Veracyte, Inc. (VCYT) - Canvas Business Model: Revenue Streams

You're looking at the core money-makers for Veracyte, Inc. as of late 2025. The focus is clearly on testing revenue, which is driving the updated full-year expectations.

The company raised its full-year 2025 testing revenue guidance based on strong year-to-date performance. This guidance now sits in the range of $484 million to $487 million, reflecting an estimated 16% year-over-year growth for the testing segment.

Here is the breakdown of the revenue streams as reported for the third quarter ended September 30, 2025:

Drilling down into the testing revenue, which is the engine here, you see the two primary drivers:

• Decipher Prostate test revenue: $82.2 million in Q3 2025.
• Afirma Thyroid test revenue: $43.2 million in Q3 2025.

The Biopharmaceutical and other revenue stream saw a significant step-down compared to the prior year, coming in at $0.8 million for the quarter. This change is tied to the restructuring and liquidation proceedings of Veracyte SAS.

For context on the core testing business performance in Q3 2025, consider these volume metrics:

• Decipher volume: Approximately 26,700 tests, a 26% year-over-year growth.
• Afirma volume: Approximately 17,000 tests, a 13% year-over-year growth.

The Product Revenue, which includes items like Prosigna kits, was $3.3 million, showing a 4% increase year-over-year. That's the current revenue picture for Veracyte, Inc. as of the third quarter of 2025.