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23andMe Fiscal Q1 Revenues Fall 34 Percent; Firm Shutters Therapeutics Discovery Business

NEW YORK – 23andMe said after the close of the market on Thursday that its fiscal first quarter revenues declined 34 percent year over year due to lower research and consumer revenue.

Separately, the company said in a filing with the US Securities and Exchange Commission that it is discontinuing the therapeutics discovery portion of its therapeutics business, effective Aug. 9. As a result, the firm has laid off 30 workers, while Bill Richards, head of therapeutics discovery and an executive officer, has resigned. 

23andMe noted that its therapeutics business will now consist solely of its therapeutics development business, which will continue to progress two programs currently in clinical development.

For the three months ended June 30, the South San Francisco, California-based company reported $40.4 million in revenues compared to $60.9 million a year ago.

Service revenues dropped 35 percent to $34.7 million from $53.3 million a year ago, while product revenue fell 25 percent to $5.7 million from $7.6 million.

23andMe said that research revenue declined after the conclusion of the exclusivity term of its collaboration with GlaxoSmithKline in July 2023. Lower consumer product revenue was a result of decreased Personal Genome Service kit volumes and telehealth orders. These decreases were partially offset by higher revenue from growth in its membership services.

During the quarter, the company launched a large-scale research study to help identify the genetic mechanisms that may drive the efficacy and potential side effects of GLP-1 medications. The company said that it also expects to launch a GLP-1 weight loss telehealth membership on its Lemonaid Health platform by the end of August.

23andMe also bolstered its Total Health offering with the addition of a "biological age" feature to help members monitor how their body is aging physiologically over time. In addition, the firm launched a new genetic polygenic risk score report for 23andMe+ members on bipolar disorder.

"The first quarter saw us achieve significant progress on our key objective of becoming a sustainably growing, profitable company while remaining committed to our vision of improving the health of millions of people worldwide," Anne Wojcicki, cofounder and CEO of 23andMe, said in a statement. "We remain focused on adding value to and prioritizing memberships in our PGS segment, driving growth in telehealth, and leveraging our data assets to create a thriving, profitable research data business."

Earlier this month, Wojcicki submitted a proposal to take the company private by purchasing all outstanding shares not already owned by her or her affiliates. The company's board of directors subsequently rejected the offer.

23andMe trimmed its Q1 net loss to $69.4 million, or $.14 per share, from a net loss of $105.0 million, or $.23 per share, a year ago.

The company's Q1 R&D expenses fell 28 percent to $44.6 million from $62.3 million a year ago, while its SG& costs dropped 35 percent to $47.9 million from $73.4 million.

23andMe finished the quarter with $170.0 million in cash and cash equivalents and $1.5 million in restricted cash.