ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. This discussion contains certain forward-looking statements that involve risk and uncertainties. Our actual results may differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those set forth under the Section entitled “Risk Factors” in Item 1A, and other documents we file with the SEC. Historical results are not necessarily indicative of future results.

A discussion regarding our financial condition and results of operations for fiscal 2024 compared to fiscal 2023 is presented under Results of Operations of this Form 10-K. Discussions regarding our financial condition and results of operations for fiscal 2023 compared to 2022 have been omitted from this Annual Report on Form 10-K, but can be found in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 28, 2024, which is available without charge on the SEC's website at www.sec.gov and on our investor relations website at caredx.com.

Overview

We are a leading precision medicine company focused on the discovery, development and commercialization of clinically differentiated, high-value diagnostic solutions for transplant patients and caregivers. We offer testing services, products, and patient and digital solutions along the pre- and post-transplant patient journey, and we are a leading provider of genomics-based information for transplant patients.

Our commercially available testing services consist of AlloSure® Kidney, a donor-derived cell-free DNA, or dd-cfDNA, solution for kidney transplant patients, AlloMap® Heart, a gene expression solution for heart transplant patients, AlloSure® Heart, a dd-cfDNA solution for heart transplant patients, and AlloSure® Lung, a dd-cfDNA solution for lung transplant patients. We have initiated several clinical studies to generate data on our existing and planned future testing services. We have signed multiple biopharma research partnerships for AlloCell, a surveillance solution that monitors the level of engraftment and persistence of allogeneic cells for patients who have received cell therapy. We also offer high-quality products that increase the chance of successful transplants by facilitating a better match between a donor and a recipient of stem cells and organs. We also provide digital solutions to transplant centers and various offerings in patient and digital solutions.

See Part I, Item 1 (Business) of this Annual Report on Form 10-K for further information about our business.

Fourth Quarter Business Highlights

•Sixth consecutive quarter of sequential testing services volume growth

•AlloSure® Kidney surveillance testing continued to increase in the fourth quarter

•Submitted first manuscript of the Kidney Outcomes Allograft Rejection (KOAR) study for publication

•Published study in the journal Transplant International shows AlloSeq cfDNA highly accurate in detecting organ transplant rejection

Full Year 2024 Financial Highlights

•Revenue of $333.8 million, driven by testing services revenue growth of 19% year-over-year

•Testing services revenue of $249.4 million, increased 19% year-over-year, and testing services volume of approximately 176,000, increased 6% year-over-year

•Patient and digital solutions revenue of $43.6 million and product revenue of $40.8 million, representing year-over-year growth of 18% and 22%, respectively

•GAAP net income of $52.5 million

•Cash flow from operations of $38 million

•Cash, cash equivalents, and marketable securities of $261 million, with no debt, as of December 31, 2024

Factors Affecting Our Performance

The Number of AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare and AlloSure Lung Tests We Receive and Report

The growth of our testing services is tied to the number of AlloSure Kidney, AlloMap Heart and AlloSure Heart, HeartCare and AlloSure Lung patient samples we receive and patient results we report. We incur costs in connection with collecting and

Table of Contents

shipping all samples and a portion of the costs when we cannot ultimately issue a report. As a result, the number of patient samples received largely correlates directly to the number of patient results reported.

Continued Growth of Patient and Digital Sales

The growth of our patient and digital revenues is tied to the continued successful implementation of our Ottr, MedActionPlan and XynQAPI software businesses, as well as continued support and maintenance of existing MedActionPlan, Ottr and XynManagement customers. The Ottr software, TransChart, Tx Access and XynQAPI are currently implemented in multiple locations in the U.S. The Ottr software implementation and XynQAPI implementation and support teams are based in Omaha, Nebraska. In addition, patient solutions offered by TTP in Flowood, Mississippi include hospital-affiliated pharmacies located on-site at the transplant center and specialty pharmacies that provide transplant-specific care and dispensing services. With the addition of HLA Data Systems, we are now able to support HLA laboratories in managing their day-to-day workflow. With the addition of MediGO, we are now serving the organ procurement market for organ logistical needs.

Development of Additional Services and Products

Our development pipeline includes other solutions to help clinicians and transplant centers make personalized treatment decisions throughout a transplant patient’s lifetime. We expect to invest in research and development in order to develop additional services and products. Our success in developing new services and products will be important in our efforts to grow our business by expanding our potential market opportunity and diversifying our sources of revenue.

Timing of Research and Development Expenses

Our spending on research and development may vary substantially from quarter to quarter. We conduct clinical studies to validate our new products, as well as on-going clinical and outcome studies to further the published evidence to support our commercialized tests. Spending on research and development for both experiments and studies may vary significantly by quarter depending on the timing of these various expenses.

Table of Contents

Results of Operations

Comparison of the Years Ended December 31, 2024 and 2023

(In thousands)

Year Ended December 31,

Revenue:

Operating expenses:

Other income:

Change in estimated fair value of common stock warrant liability — 10 (10)

Testing services revenue

Testing services revenue increased by $39.7 million, or 19%, for the year ended December 31, 2024, compared to the year ended December 31, 2023. Revenue increase is primarily driven by testing services volume growth of 6%, and improved average selling price driven by increased collections including collections related to tests performed in prior periods.

Product revenue

Product revenue increased by $7.3 million, or 22%, for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to higher demand of our commercial NGS-based kitted solutions.

Patient and digital solutions revenue

Patient and digital solutions revenue increased by $6.5 million, or 18%, during the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to revenue generated from HLA Data Systems, MediGO, Transplant Pharmacy and other core digital offerings.

Cost of testing services

Cost of testing services decreased by $2.0 million, or (4)%, for the year ended December 31, 2024, compared to the year ended December 31, 2023. The decrease is primarily driven by efficiency measures to lower laboratory expenses.

Cost of product

Table of Contents

Cost of product increased by $5.0 million, or 27%, for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to an increase in product revenue.

Cost of patient and digital solutions

Cost of patient and digital solutions increased by $4.7 million, or 18%, for the year ended December 31, 2024, compared to the year ended December 31, 2023. The increase in the cost of patient and digital solutions is in line with the increase in revenue for patient and digital solutions and is primarily due to an increase in cost of goods from sales in the pharmacy business and our digital offerings.

Research and development

Research and development expenses decreased by $9.5 million, or (12)%, for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to a decrease in clinical trials of $6.5 million, a decrease in consulting and professional fees of $2.4 million and a decrease in software costs of $0.5 million.

Sales and marketing

Sales and marketing expenses decreased by $1.6 million, or (2)%, for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to a decrease in stock-based compensation expense of $1.4 million, a decrease in travel costs of $0.6 million and a decrease in tradeshows and events of $1.6 million, offset by an increase in personnel-related costs of $2.2 million.

General and administrative

General and administrative expenses increased by $5.9 million, or 5%, for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to an increase in stock-based compensation expense of $19.5 million, and an increase in personnel-related costs of $8.8 million, offset by a decrease in legal expenses of $18.5 million, a decrease in other expenses of $4.5 million. The increase in stock-based compensation expense was primarily due to accelerated vesting over a shortened service period for awards held by the former CEO and former General Counsel of $14.3 million.

Restructuring costs

Restructuring costs decreased by $0.5 million for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to lesser headcount impacted by restructuring.

Litigation expense

Litigation expense relates to the patent infringement claims filed by Natera against us and alleged that our product, AlloSure, infringes Natera's U.S. Patent 11,111,544. The jury awarded Natera an amount of $96.3 million and we recorded the amount as litigation expense for the year ended December 31, 2023. In February 2025, the District Court ruled that the patents asserted against us are invalid. We reversed the $96.3 million of litigation expense in the year ended December 31, 2024.

Interest income, net

Interest income, net, decreased by $0.1 million for the year ended December 31, 2024, compared to the year ended December 31, 2023, primarily due to a decrease in interest rates.

Other income, net

During the year ended December 31, 2023, the following events occurred: a $1.0 million gain from settlement of an obligation and a $1.1 million gain from the recovery of an impaired loan that was already written-off, offset by a decrease in unrealized investment loss of $0.3 million. During the year ended December 31, 2024, there was a $0.5 million gain from a reduction in contingent consideration and an increase in other business expense of $0.3 million. These resulted in a decrease in other income, net, of $1.0 million for the year ended December 31, 2024, compared to the year ended December 31, 2023.

Income tax expense

For the year ended December 31, 2024, we recorded an income tax expense of $0.3 million on an income before income taxes of $52.9 million. The effective tax rate for the twelve months ended December 31, 2024 differs from the federal statutory tax rate mainly due to the change in valuation allowance, windfall tax benefits from stock-based compensation, nondeductible executive compensation and tax credits.

Table of Contents

For the year ended December 31, 2023, we recorded an income tax expense of $0.1 million on a loss before income taxes of $190.1 million. The difference in the effective tax rate for the year ended December 31, 2023 from the federal statutory tax rate is mainly due to the state income tax expense per the new research and development regulations, whereas in prior years we only recognized the deferred tax assets from foreign losses with the full valuation allowance.

Table of Contents

Liquidity and Capital Resources

We have incurred significant losses and negative cash flows from operations since our inception and had an accumulated deficit of $626.2 million at December 31, 2024. As of December 31, 2024, we had cash, cash equivalents and marketable securities of $260.7 million, and no debt outstanding.

We believe our existing cash balance and expected cash from existing operations, including cash from current license agreements and future license and collaboration agreements, or a combination of these, will be sufficient to meet our anticipated cash requirements for the next 12 months.

Shelf Registration Statement

On May 10, 2023, we filed a universal shelf registration statement (File No. 333-271814), or the Registration Statement, and we thereafter filed post-effective amendments on May 9, 2024 and May 23, 2024. The SEC declared the Registration Statement effective on May 23, 2024, and as a result, we can sell from time to time up to $250.0 million of shares of our common stock, preferred stock, debt securities, warrants, units or rights comprised of any combination of these securities, for our own account in one or more offerings under the Registration Statement. The terms of any offering under the Registration Statement will be established at the time of such offering and will be described in a prospectus supplement to the Registration Statement filed with the SEC prior to the completion of any such offering.

Stock Repurchase Program

On December 3, 2022, our Board of Directors approved our Stock Repurchase Program, or the Repurchase Program, whereby we may purchase up to $50 million in shares of our common stock over a period of up to two years, commencing on December 8, 2022. The Repurchase Program may be carried out, subject to approval by the committee of the Board of Directors, through open market purchases, one or more Rule 10b5-1 trading plans and block trades and in privately negotiated transactions. During the year ended December 31, 2024, we purchased an aggregate of 55,500 shares of our common stock under the Repurchase Program for an aggregate purchase price of $0.5 million. The Repurchase Program was renewed on February 20, 2025 where we may purchase up to $50 million in shares of our common stock over a period of up to two years, commencing on February 20, 2025.

Cash Flows

The following table summarizes our cash flows for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,

(in thousands)

Net cash provided by (used in):

Cash Flows from Operating Activities

Net cash provided by (used in) operating activities consists of net income (loss), adjusted for certain noncash items in the consolidated statements of operations and changes in operating assets and liabilities.

Net cash provided by operating activities for the year ended December 31, 2024 was $38.0 million. Net operating assets decreased by $102.3 million. Our noncash items included $66.4 million in stock-based compensation expense, $14.2 million of depreciation and amortization expense, $5.6 million of amortization of right-of-use assets, $0.6 million of amortization of premium on short-term marketable securities, net, and revaluation of contingent consideration to estimated fair value of $0.9 million.

Net cash used in operating activities for the year ended December 31, 2023 was $18.4 million. Our net loss of $190.3 million was our primary use of cash in operating activities. Our net loss also included the following noncash items: $49.1 million in stock-based compensation expense, $14.4 million of depreciation and amortization expense, amortization of right-of-use assets of $5.4 million, asset impairments and write-downs of $1.0 million, amortization of premium on short-term marketable securities, net of $4.9 million, gain on settlement of obligation and recovery of written-off investment of $2.1 million and revaluation of contingent consideration to estimated fair value of $2.7 million. Cash used in operating activities was also due to an increase in accounts receivable of $16.0 million. Cash used in operating activities was partially offset by an increase in net

Table of Contents

operating assets of $90.6 million including litigation expense of $96.3 million recorded as other liabilities related to the jury award in the Natera IP infringement matter.

Cash Flows from Investing Activities

For the year ended December 31, 2024, net cash used in investing activities was $0.5 million and primarily related to purchase of short-term marketable securities of $160.3 million, additions of capital expenditures of $6.5 million and purchase of corporate equity securities of $0.6 million, offset by maturities of short-term marketable securities of $166.9 million.

For the year ended December 31, 2023, net cash provided by investing activities was $40.4 million and primarily related to proceeds from maturities of marketable securities of $256.0 million and sale of corporate equity securities of $2.5 million. These proceeds were partially offset by the purchase of short-term marketable securities of $201.2 million, additions of capital expenditures of $8.3 million, payments for acquired intangibles of $0.9 million, purchase of corporate equity securities of $1.0 million and acquisition of business, net of cash acquired of $6.7 million.

Cash Flows from Financing Activities

Net cash used in financing activities for the year ended December 31, 2024 was $5.6 million and primarily related to repurchase and retirement of common stock of $0.5 million, taxes paid related to net share settlements of restricted stock units of $10.1 million and payments of contingent consideration of $5.3 million. These payments were partially offset by the proceeds from exercises of stock options of $8.9 million and proceeds from issuances of shares of common stock under our employee stock purchase plan of $1.4 million.

Net cash used in financing activities for the year ended December 31, 2023 was $29.6 million and primarily related to repurchase and retirement of common stock of $27.5 million, taxes paid related to net share settlements of restricted stock units of $3.1 million and payments of contingent consideration of $0.6 million. These payments were partially offset by the proceeds from exercises of stock options of $0.1 million and proceeds from issuances of shares of common stock under our employee stock purchase plan of $1.5 million.

For a discussion regarding our cash flows for the year ended December 31, 2022, please refer to the discussion under the heading “Results of Operations—Liquidity and Capital Resources” in Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 28, 2024.

Contractual Obligations

For a discussion regarding our significant contractual obligations as of December 31, 2024 and the effect those obligations are expected to have on our liquidity and cash flows in future periods, please refer to Note 9, Commitments and Contingencies, of the consolidated financial statements, and “Results of Operations—Liquidity and Capital Resources”, respectively, included elsewhere in this Annual Report on Form 10-K.

Foreign Operations

The accompanying consolidated balance sheets contain certain recorded assets in foreign countries, namely Stockholm, Sweden, and Fremantle, Australia. Although these countries are considered economically stable and we have experienced no notable burden from foreign exchange transactions, export duties, government regulations, or unanticipated events in foreign countries could have a material adverse effect on our operations.

Critical Accounting Policies and Significant Judgments and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported revenue generated and expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are 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.

Our significant accounting policies are described in Note 2, Summary of Significant Accounting Policies, of the consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information. Some of these accounting policies require us to make difficult and subjective judgments, often as a result of the need to make estimates of

Table of Contents

matters that are inherently uncertain. We believe that the following critical accounting policies reflect the more significant estimates and assumptions used in the preparation of our consolidated financial statements.

Revenue Recognition

We recognize revenue from testing services, product sales and patient and digital solutions revenue in the amount that reflects the consideration which it expects to be entitled in exchange for goods or services as it transfers control to its customers. Revenue is recorded considering a five-step revenue recognition model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations and recognizing revenue when, or as, an entity satisfies a performance obligation.

Testing Services Revenue

AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare and AlloSure Lung patient tests are ordered by healthcare providers. We receive a test requisition form with payer information along with a collected patient blood sample. We consider the patient to be our customer and the test requisition form to be the contract. Testing services are performed in our laboratory. Testing services represent one performance obligation in a contract and are performed when results of the test are provided to the healthcare provider, at a point in time.

The healthcare providers that order the tests and on whose behalf we provide testing services are generally not responsible for the payment of these services. The first criterion, identify the contract(s) with a customer, and the second criterion, identify the performance obligations in the contract, of revenue recognition are satisfied when we receive a test requisition form with payer information from the healthcare provider. Generally, we bill third-party payers upon delivery of an AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare or AlloSure Lung test result to the healthcare provider. Amounts received may vary amongst payers based on coverage practices and policies of the payer.

We have used the portfolio approach, a practical expedient under Accounting Standards Codification, or ASC, Topic 606, Revenue from Contracts with Customers, to identify financial classes of payers. Revenue recognized for Medicare and other contracted payers is based on the agreed current reimbursement rate per test, adjusted for historical collection trends where applicable. We estimate revenue for non-contracted payers and self-payers using transaction prices determined for each financial class of payers using history of reimbursements. This includes analysis of an average reimbursement per test and a percentage of tests reimbursed. This estimate requires significant judgment.

We monitor revenue estimates at each reporting period based on actual cash collections in order to assess whether a revision to the estimate is required. Changes in transaction price estimates are updated quarterly based on actual cash collected or changes made to contracted rates, our discussions with payers, and other pertinent information. In addition, consistent with ASC 606-10-25-1, we continue to assess whether it is probable that we will collect substantially all of the consideration to which we will be entitled when determining if a contract with a customer exists.

Product Revenue

Product revenue is recognized from the sale of products to end-users, distributors and strategic partners when all revenue recognition criteria are satisfied. We generally have a contract or a purchase order from a customer with the specified required terms of order, including the number of products ordered. Transaction prices are determinable in the contract. The products are delivered and risk of loss passed to the customer upon either shipping or delivery, as per the terms of the agreement. There are no further performance obligation related to a contract and revenue is recognized at the point of delivery consistent with the terms of the contract or purchase order.

Patient and Digital Solutions Revenue

Patient and digital solutions revenue is primarily derived from a combination of SaaS and perpetual software license agreements entered into with various transplant centers, which are our customers for this class of revenue. The main performance obligations in connection with our SaaS and perpetual software license agreements are the following: (i) implementation services and delivery of the perpetual software license, which are considered a single performance obligation, (ii) post contract support. We allocate the transaction price to each performance obligation based on relative stand-alone selling prices of each distinct performance obligation. Digital revenue in connection with perpetual software license agreements is recognized at the point in time when control of the license is transferred and made available for the customer's use and benefit.

Perpetual software license agreements typically require advance payments from customers upon the achievement of certain milestones. We record deferred revenue in relation to these agreements when cash payments are received, or invoices are issued in advance of our performance, and generally recognize revenue over the contractual term, as performance obligations are fulfilled.

Table of Contents

In addition, we derive patient and digital solutions revenue from software subscriptions and medication sales. We generally bill software subscription fees in advance. Revenue from software subscriptions is deferred and recognized ratably over the subscription term. The medication sales revenue is recognized based on the negotiated contract price with the governmental, commercial and non-commercial payers with any applicable patient co-pay. We recognize revenue from medication sales when prescriptions are delivered.

Stock-based Compensation

We use the Black-Scholes Model, which requires the use of estimates such as stock price volatility and expected option lives, to value employee stock options. We estimate the expected option lives using historical data, estimate volatility using our own historical stock prices, estimate risk-free rates using the implied yield currently available in the U.S. Treasury zero-coupon issues with a remaining term equal to the expected option lives, and estimate dividend yield using our expectations and historical data. The fair value of each restricted stock unit is calculated based upon the closing price of our common stock on the date of the grant.

We use the straight-line attribution method for recognizing compensation expense. Compensation expense is recognized on awards ultimately expected to vest and reduced for forfeitures that are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Forfeitures are estimated based on our historical experience.

Compensation expense for stock options issued to nonemployees is calculated using the Black-Scholes Model and is recorded over the service performance period using the straight-line attribution method. Options subject to vesting are required to be periodically re-measured over their service performance period, which is generally the same as the vesting period.

Business Combinations

We determine and allocate the purchase price of an acquired business to the assets acquired and liabilities assumed based on their estimated fair values as of the business combination date, including separately identifiable intangible assets, which are separable from goodwill. We base the estimated fair value of identifiable intangible assets acquired in a business combination on independent valuations that use information and assumptions provided by management, which consider management’s best estimates of inputs and assumptions that a market participant would use. We allocate any excess purchase price over the estimated fair value assigned to the net tangible and identifiable intangible assets acquired and liabilities assumed to goodwill. The use of alternative valuation assumptions, including estimated revenue projections, growth rates, royalty rates, cash flows, discount rates, estimated useful lives and probabilities surrounding the achievement of contingent milestones, could result in different purchase price allocations and amortization expense in current and future periods.

In those circumstances where an acquisition involves a contingent consideration arrangement that meets the definition of a liability under ASC Topic 480, Distinguishing Liabilities from Equity, we recognize a liability equal to the fair value of the contingent payments that we expect to make as of the acquisition date. We re-measure this liability each reporting period and record changes in the fair value as a component of operating expenses.

Transaction costs associated with acquisitions are expensed as incurred in general and administrative expenses. Results of operations and cash flows of acquired companies are included in our operating results from the date of acquisition.

Acquired Intangible Assets

Amortizable intangible assets include customer relationships, developed technology, commercialization rights, trademarks and in-process technology assets acquired as part of a business combination or asset acquisition. Intangible assets subject to amortization are amortized over their estimated useful lives. Acquired in-process technology assets and a favorable license agreement are considered to be indefinite-lived until the completion or abandonment of the associated research and development efforts. If and when development is complete, which generally occurs if and when regulatory approval to market a product is obtained, the associated assets would be deemed finite-lived and would then be amortized based on their respective estimated useful lives at that point in time.

Impairment of Goodwill, Intangible Assets and Long-lived Assets

Goodwill

Goodwill recorded in a business combination is not subject to amortization. Instead, it is tested for impairment on an annual basis and whenever events or changes in circumstances indicate its carrying amount may not be recoverable. We have a single reporting unit and consequently evaluate goodwill for impairment based on an evaluation of the fair value of our company as a whole.

Table of Contents

Our annual impairment test date is December 1st. During the goodwill impairment review, we assess qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than the carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and the market considerations, and our overall financial performance. If, after assessing the totality of these qualitative factors, we determine that it is not more likely than not that the fair value of the reporting unit is less than the carrying amount, then no additional assessment is deemed necessary. Otherwise, we proceed to compare the estimated fair value of the reporting unit with the carrying value, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, we record an impairment loss based on the difference. We elect to bypass the qualitative assessment in a period and proceeds to perform the quantitative goodwill impairment test.

When necessary, to determine the reporting unit’s fair value under the quantitative approach, we use a combination of income and market approaches, such as estimated discounted future cash flows of that reporting unit, multiples of earnings or revenues, and analysis of recent sales or offerings of comparable entities. We also consider our market capitalization on the date of the analysis to ensure the reasonableness of the reporting unit’s fair value.

In connection with our annual goodwill assessment on December 1, 2024, we performed a qualitative assessment taking into consideration past, current and projected future earnings, recent trends and market conditions, and our market capitalization. Based on this analysis, we concluded that it was more likely than not that the fair value of the reporting unit exceeded its carrying amount. As such, it was not necessary to perform the quantitative goodwill impairment assessment at that time. As of December 31, 2024, no impairment of goodwill has been identified.

Intangible assets not subject to amortization

We evaluate the carrying value of intangible assets not subject to amortization, related to acquired in-process technology assets and a favorable license agreement, which are considered to be indefinite-lived until the completion or abandonment of the associated research and development efforts. Accordingly, amortization of the acquired in-process technology assets and favorable license agreement will not occur until the products reach commercialization.

During the period the assets are considered indefinite-lived, they are tested for impairment on an annual basis, as well as between annual tests if we become aware of any events occurring or changes in circumstances that would indicate that the fair values of the acquired in-process technology assets are less than their carrying amounts. An impairment loss would be recorded when the fair value of an acquired in-process technology asset is less than its carrying value. If and when development is complete, which generally occurs when the products are made commercially available, the associated acquired in-process technology asset will be deemed finite-lived and will then be amortized based on its estimated useful life.

As of December 31, 2024, no impairment of acquired in-process technology assets has been identified.

Intangible assets and long-lived assets subject to amortization

We evaluate our finite-lived intangible assets and our long-lived assets for indicators of possible impairment when events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. We then compare the carrying amounts of an asset group with the future net undiscounted cash flows expected to be generated by such asset group. If an impairment exists, we measure the impairment based on the excess carrying value of the asset group over the asset group’s fair value determined using discounted estimates of future cash flows. As of December 31, 2024, no impairment has been identified.

Recently Issued Accounting Standards

Refer to Note 2, Summary of Significant Accounting Policies - Recent Accounting Pronouncements, to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K for a description of recently issued accounting pronouncements, including the expected dates of adoption and estimated effects on our results of operations, financial position and cash flows.

Table of Contents

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We are exposed to market risks in the ordinary course of our business. We had cash and cash equivalents of $114.7 million at December 31, 2024, which consisted of bank deposits and money market funds. However, we have not been exposed to, nor do we anticipate being exposed to, material risks due to changes in interest rates. A hypothetical 100 basis point increase or decrease in interest rates during any of the periods presented would have an approximate impact of $1.1 million on our consolidated balance sheets.

Foreign Currency Exchange Risk

We have operations in Sweden and sell to other countries throughout the world. As a result, we are subject to foreign currency risks, including transacting in foreign currencies, investment in a foreign entity, as well as assets and debts denominated in foreign currencies. Our testing services revenue is primarily denominated in U.S. dollars. Our product revenue is denominated primarily in U.S. dollars and the Euro. Our patient and digital solutions revenue is primarily denominated in U.S. dollars. Consequently, our revenue denominated in foreign currency is subject to foreign currency exchange risk. A portion of our operating expenses are incurred outside of the U.S. and are denominated in Swedish Krona, and the Euro, which are also subject to fluctuations due to changes in foreign currency exchange rates. An unfavorable 10% change in foreign currency exchange rates for our assets and liabilities denominated in foreign currencies at December 31, 2024, would have negatively impacted our consolidated balance sheets for the year ended December 31, 2024 by $0.1 million and our product revenue by $1.5 million. Currently, we do not have any near-term plans to enter into a formal hedging program to mitigate the effects of foreign currency volatility but may do so in the future if our exposure to foreign currencies should become more significant. We will continue to reassess our approach to managing our risk relating to fluctuations in foreign currency exchange rates.

Table of Contents

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CareDx, Inc.

Index to Consolidated Financial Statements

Page No.

Reports of Independent Registered Public Accounting Firm (PCAOB ID No. 34) 69

Consolidated Balance Sheets 73

Consolidated Statements of Operations 74

Consolidated Statements of Comprehensive Income (Loss) 75

Consolidated Statements of Stockholders’ Equity 76

Consolidated Statements of Cash Flows 77

Notes to Consolidated Financial Statements 78

Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of CareDx, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of CareDx, Inc. and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 27, 2025, expressed an adverse opinion on the Company's internal control over financial reporting because of a material weakness.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Testing Services Revenue (non-Medicare) — Refer to Note 2 to the consolidated financial statements

Critical Audit Matter Description

The Company’s testing services revenue is recognized when the results of the test are provided to the healthcare provider, at which time the Company generally bills for its services. The Company estimates revenue for non-Medicare payers using transaction prices determined for each financial class of payers using their history of reimbursements.

The transaction price estimate includes an analysis of the average reimbursement per test and a percentage of tests reimbursed. This estimate requires significant judgment. The Company monitors revenue estimates at each reporting period based on actual cash collections in order to assess whether a revision to the estimate is required. Changes in transaction price estimates are updated quarterly based on actual cash collected. The Company also considers whether historical collections per test are indicative of future collections or if there are any current or expected developments or changes that could affect reimbursement rates.

We identified management’s estimation of the transaction price for transaction services billed to non-Medicare payers as a critical audit matter due to the significant judgments required by management to estimate how coverage practices and policies of payers might affect the amounts received. This required a high degree of auditor judgment and an increased extent of effort, including the involvement of more experienced engagement team members, when performing audit procedures to evaluate the estimated transaction prices.

Table of Contents

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to management’s estimation of transaction prices for testing services revenue (non-Medicare) included the following, among others:

•We tested the effectiveness of controls over the Company’s testing services revenue, including those over the estimation of transaction prices.

•We tested the assumptions used by management to estimate transaction prices by:

◦Testing the mathematical accuracy of management’s calculation.

◦Testing the historical cash receipts from non-Medicare payers used in the estimate of transaction prices, by making selections and agreeing the selected information to source documents.

◦Testing management’s ability to estimate transaction prices accurately by comparing recorded revenue to cash receipts received through December 2024.

◦Evaluating trends in revenue and accounts receivable compared to previous periods to identify evidence inconsistent with management’s estimated transaction prices.

◦We tested the accuracy and completeness of the lab billing report by tracing to source documents, including the test requisition form, fax support, proof of insurance, and payment support.

/s/ Deloitte & Touche LLP

San Francisco, California

February 27, 2025

We have served as the Company's auditor since 2018.

Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of CareDx, Inc.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of CareDx, Inc. and subsidiaries (the “Company”) as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, because of the effect of the material weakness identified below on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated February 27, 2025, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Material Weakness

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The following material weakness has been identified and included in management's assessment:

COSO Framework

The Company did not fully maintain components of the COSO framework, including elements of the control environment, risk assessment, control activities, and monitoring activities components, relating to (i) sufficiency of competent personnel to perform internal control activities and support the achievement of our internal control objectives; (ii) monitoring and risk assessment are performed to monitor and identify risks related to complex and/or non-routine transactions; and (iii) performing control activities in accordance with established policies in a timely manner.

Table of Contents

Specifically, the Company determined that insufficient risk assessment was performed to identify risks related to complex and/or non-routine transactions and financial reporting personnel failed to perform control activities and to provide necessary oversight and monitoring of the accounting and reporting of complex and/or non-routine transactions. This control deficiency creates a reasonable possibility that a material misstatement of the Company’s consolidated financial statements would not be prevented or detected on a timely basis and constitutes a material weakness in the Company’s internal control over financial reporting.

This material weakness was considered in determining the nature, timing, and extent of audit tests applied in our audit of the consolidated financial statements as of and for the year ended December 31, 2024 of the Company, and this report does not affect our report on such financial statements.

/s/ Deloitte & Touche LLP

San Francisco, California

February 27, 2025

Table of Contents

CareDx, Inc.

Consolidated Balance Sheets

(In thousands, except share data)

As of December 31,

Assets

Current assets:

Prepaid and other current assets 7,071 7,763

Liabilities and stockholders’ equity

Current liabilities:

Operating lease liability, less current portion 22,263 28,278

Commitments and contingencies (Note 9)

Stockholders’ equity:

Accumulated other comprehensive loss (8,569) (6,963)

Total liabilities and stockholders’ equity $ 491,050 $ 466,826

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

CareDx, Inc.

Consolidated Statements of Operations

(In thousands, except share and per share data)

Year Ended December 31,

Revenue:

Operating expenses:

Other income (expense):

Change in estimated fair value of common stock warrant liability — 10 107

Net income (loss) per share (Note 3):

Weighted-average shares used to compute net income (loss) per share:

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

CareDx, Inc.

Consolidated Statements of Comprehensive Income (Loss)

(In thousands)

Year ended December 31,

Other comprehensive loss:

Foreign currency translation adjustments, net of tax (1,606) 540 (2,833)

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

CareDx, Inc.

Consolidated Statements of Stockholders’ Equity

(In thousands, except share amounts)

Shares Amount

Repurchase and retirement of common stock (50,051) — — — (642) (642)

Issuance of common stock for services 12,764 — 319 — — 319

Employee stock-based compensation expense — — 46,206 — — 46,206

Foreign currency translation adjustment — — — (2,833) — (2,833)

Issuance of common stock for services 21,965 — 216 — — 216

Issuance of common stock for cash upon exercise of warrants 3,132 — 26 — — 26

Employee stock-based compensation expense — — 48,907 — — 48,907

Foreign currency translation adjustment — — — 540 — 540

Repurchase and retirement of common stock (55,500) — — — (522) (522)

Issuance of common stock for services 16,582 — 174 — — 174

Employee stock-based compensation expense — — 66,267 — — 66,267

Foreign currency translation adjustment — — — (1,606) — (1,606)

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

CareDx, Inc.

Consolidated Statements of Cash Flows

(In thousands)

Year Ended December 31,

Operating activities:

Asset impairments and write-downs — 1,000 840

Unrealized loss on long-term marketable equity securities — — 1,181

Realized gain on sale of long-term marketable equity securities, net — (284) —

Loss on disposal of asset 91 44 —

Revaluation of contingent consideration to estimated fair value 931 2,677 727

Changes in operating assets and liabilities:

Accrued royalties — (1,557) —

Net cash provided by (used in) operating activities 38,048 (18,388) (25,239)

Investing activities:

Purchase of corporate equity securities (634) (965) —

Sale of corporate equity securities — 2,460 —

Acquisition of intangible assets — (896) (3,100)

Acquisition of business, net of cash acquired — (6,682) (610)

Net cash (used in) provided by investing activities (483) 40,446 (228,502)

Financing activities:

Payment of contingent consideration (5,325) (625) (2,625)

Repurchase and retirement of common stock (522) (27,541) (642)

Proceeds from exercise of warrants — 4 —

Effect of exchange rate changes on cash and cash equivalents 532 (112) 23

Supplemental disclosures of cash information

Cash paid for interest $ — $ — $ 8

Supplemental disclosures of cash flow information

Shares issued in lieu of payment $ 174 $ 216 $ 319

Operating lease right-of-use assets $ 195 $ 607 $ 22,267

Contingent consideration $ — $ 3,499 $ —

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

CareDx, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION AND DESCRIPTION OF BUSINESS

CareDx, Inc. (“CareDx” or the “Company”), together with its subsidiaries, is a leading precision medicine company focused on the discovery, development and commercialization of clinically differentiated, high-value diagnostic solutions for transplant patients and caregivers. The Company offers testing services, products, and patient and digital solutions along the pre- and post-transplant patient journey. The Company’s headquarters are in Brisbane, California. The primary operations are in Brisbane, California; Omaha, Nebraska; and Stockholm, Sweden.

The Company’s commercially available testing services consist of AlloSure® Kidney, a donor-derived cell-free DNA (“dd-cfDNA”) solution for kidney transplant patients, AlloMap® Heart, a gene expression solution for heart transplant patients, AlloSure® Heart, a dd-cfDNA solution for heart transplant patients, and AlloSure® Lung, a dd-cfDNA solution for lung transplant patients. The Company has initiated several clinical studies to generate data on its existing and planned future testing services. The Company has signed multiple biopharma research partnerships for AlloCell, a surveillance solution that monitors the level of engraftment and persistence of allogeneic cells for patients who have received cell therapy. The Company also offers high-quality products that increase the chance of successful transplants by facilitating a better match between a donor and a recipient of stem cells and organs. The Company also provides digital solutions to transplant centers and various offerings.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts of the Company and its subsidiaries. Intercompany transactions have been eliminated.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses in the consolidated financial statements and accompanying notes. On an ongoing basis, management evaluates its estimates, including those related to transaction price estimates used for testing services revenue; standalone fair value of patient and digital solutions revenue performance obligations; accrued expenses for clinical studies; inventory valuation; the fair value of assets and liabilities acquired in a business combination or an asset acquisition (including identifiable intangible assets acquired); the fair value of contingent consideration recorded in connection with a business combination or an asset acquisition; the grant date fair value assumptions used to estimate stock-based compensation expense; income taxes; impairment of long-lived assets and indefinite-lived assets (including goodwill); and legal contingencies. Actual results could differ from those estimates.

Concentrations of Credit Risk and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to credit risk consist of cash, cash equivalents and marketable securities. The Company’s policy is to invest its cash and cash equivalents in money market funds, obligations of U.S. government agencies and government-sponsored entities, commercial paper, corporate debt securities and various bank deposit accounts. The counterparties to the agreements relating to the Company’s investments consist of financial institutions of high credit standing. The Company is exposed to credit risk in the event of default by the financial institutions to the extent of amounts recorded on the balance sheets that may be in excess of insured limits.

The Company is also subject to credit risk from its accounts receivable, which are derived from revenue earned from AlloSure Kidney, AlloSure Heart, AlloMap Heart, HeartCare and AlloSure Lung tests provided for patients located in the U.S. and Canada, and billed to various third-party payers, from sales of products to distributors, strategic partners and transplant laboratories in Europe, Asia, the Middle East, Africa, the U.S., Latin America and other geographic regions, and from sales of patient and digital solutions software. The Company has not experienced any significant credit losses and does not require collateral on receivables. For the years ended December 31, 2024, 2023 and 2022, approximately 38%, 40% and 53%, respectively, of total revenue was billed to Medicare. No other payers represented more than 10% of total revenue for the years ended December 31, 2024, 2023 and 2022.

As of December 31, 2024 and 2023, approximately 27% and 36%, respectively, of accounts receivable was due from Medicare. No other payer or customer represented more than 10% of accounts receivable at either December 31, 2024 or 2023.

Table of Contents

Cash and Cash Equivalents

Cash equivalents consist of short-term, highly liquid investments with original maturities of three months or less from the date of purchase. Cash equivalents consist primarily of amounts invested in money market funds.

Restricted Cash

As a condition of the lease agreements for certain facilities, the Company must maintain letters of credit and certain minimum collateral requirements. The cash used to support these arrangements of $0.6 million is classified as long-term restricted cash on the accompanying consolidated balance sheets.

Marketable Securities

The Company considers all highly liquid investments in securities with a maturity of greater than three months at the time of purchase to be marketable securities. As of December 31, 2024, the Company’s short-term marketable securities consisted of corporate debt securities with maturities of greater than three months but less than 12 months at the time of purchase, which were classified as current assets on the consolidated balance sheet.

The Company classifies its short-term marketable securities as held-to-maturity at the time of purchase and reevaluates such designation at each balance sheet date. The Company has the positive intent and ability to hold these marketable securities to maturity. Short-term marketable securities are carried at amortized cost and are adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income, net, on the condensed consolidated statements of operations. Realized gains and losses and declines in value judged to be other-than-temporary, if any, on short-term marketable securities are included in interest income, net. The cost of securities sold is determined using specific identification.

Inventory

Inventories are stated at the lower of actual purchased cost, determined on an average cost basis, on a first-in, first-out basis, or at net realizable value. Excess and obsolete inventories are determined primarily based on expiration dates and future demand forecasts, and write-downs of excess and obsolete inventories are recorded as a component of cost of product.

Property and Equipment, net

Property and equipment are stated at historical cost, less accumulated depreciation. Property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets. The estimated useful life is generally three to five years for computer, office and laboratory equipment, and seven years for furniture and fixtures. Leasehold improvements are amortized over the shorter of their estimated useful lives or the remaining lease term.

The Company capitalizes certain costs incurred for software developed or obtained for internal use, including hosting arrangements. These costs include software licenses and consulting services, as well as employee payroll and payroll-related costs. Capitalized internal-use software costs are usually amortized over a period of three to seven years.

Business Combinations

The Company determines and allocates the purchase price of an acquired business to the assets acquired and liabilities assumed based on their estimated fair values as of the business combination date, including separately identifiable intangible assets, which are separable from goodwill. The Company bases the estimated fair value of identifiable intangible assets acquired in a business combination on independent valuations that use information and assumptions provided by management, which consider management’s best estimates of inputs and assumptions that a market participant would use. The Company allocates any excess purchase price over the estimated fair value assigned to the net tangible and identifiable intangible assets acquired and liabilities assumed to goodwill. The use of alternative valuation assumptions, including estimated revenue projections, growth rates, royalty rates, cash flows, discount rates, estimated useful lives and probabilities surrounding the achievement of contingent milestones could result in different purchase price allocations and amortization expense in current and future periods.

In those circumstances where an acquisition involves a contingent consideration arrangement that meets the definition of a liability under Accounting Standard Codification (“ASC”), Topic 480, Distinguishing Liabilities from Equity, the Company recognizes a liability equal to the fair value of the contingent payments that the Company expects to make as of the acquisition date. The Company remeasures this liability each reporting period and records changes in the fair value as a component of operating expenses.

Transaction costs associated with acquisitions are expensed as incurred in general and administrative expenses. Results of operations and cash flows of acquired companies are included in the Company’s operating results from the date of acquisition.

Table of Contents

Acquired Intangible Assets

Amortizable intangible assets include customer relationships, developed technology, commercialization rights, trademarks and in-process technology assets acquired as part of a business combination or asset acquisition. Intangible assets subject to amortization are amortized over their estimated useful lives. Acquired in-process technology assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development efforts. If and when development is complete, which generally occurs if and when regulatory approval to market a product is obtained, the associated assets would be deemed finite-lived and would then be amortized based on their respective estimated useful lives at that point in time.

Impairment of Goodwill, Intangible Assets and Long-lived Assets

Goodwill

Goodwill recorded in a business combination is not subject to amortization. Instead, it is tested for impairment on an annual basis and whenever events or changes in circumstances indicate its carrying amount may not be recoverable. The Company has a single reporting unit and consequently evaluates goodwill for impairment based on an evaluation of the fair value of the Company as a whole.

The Company’s annual impairment test date is December 1st. During the goodwill impairment review, the Company assesses qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than the carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and the market considerations, and the Company's overall financial performance. If, after assessing the totality of these qualitative factors, the Company determines that it is not more likely than not that the fair value of the reporting unit is less than the carrying amount, then no additional assessment is deemed necessary. Otherwise, the Company proceeds to compare the estimated fair value of the reporting unit with the carrying value, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, the Company records an impairment loss based on the difference. The Company elects to bypass the qualitative assessment in a period and proceeds to perform the quantitative goodwill impairment test.

When necessary, to determine the reporting unit’s fair value under the quantitative approach, the Company uses a combination of income and market approaches, such as estimated discounted future cash flows of that reporting unit, multiples of earnings or revenues, and analysis of recent sales or offerings of comparable entities. The Company also considers its market capitalization on the date of the analysis to assess thereasonableness of the reporting unit’s fair value.

Indefinite-lived intangible assets

The Company evaluates the carrying value of indefinite-lived intangible assets, related to acquired in-process technology assets and a favorable license agreement, which are considered to be indefinite-lived until the completion or abandonment of the associated research and development efforts. Accordingly, amortization of the acquired in-process technology assets and the favorable license agreement will not occur until the products reach commercialization.

During the period the assets are considered indefinite-lived, they are tested for impairment on an annual basis, as well as between annual tests if the Company becomes aware of any events occurring or changes in circumstances that would indicate that the fair value of the acquired in-process technology assets and the favorable license agreement are less than their carrying amounts. An impairment loss would be recorded when the fair value of an acquired in-process technology asset and the favorable license agreement are less than the carrying value. If and when development is complete, which generally occurs when the products are made commercially available, the associated acquired in-process technology asset and the favorable license agreement will be deemed finite-lived and will then be amortized based on the estimated useful life.

Finite-lived intangible assets and long-lived assets

The Company evaluates its finite-lived intangible assets and its long-lived assets for indicators of possible impairment when events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. The Company then compares the carrying amounts of the asset group with the future net undiscounted cash flows expected to be generated by such asset group. If an impairment exists, the Company measures the impairment based on the excess carrying value of the asset group over the asset group’s fair value determined using discounted estimates of future cash flows. Intangible assets subject to amortization are carried at cost less accumulated amortization. Amortization expenses are recorded to cost of testing services, cost of product, cost of patient and digital solutions, and sales and marketing expenses in the consolidated statements of operations.

Table of Contents

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The Company uses the U.S. GAAP fair value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value as follows:

•Level 1: Inputs that include quoted prices in active markets for identical assets and liabilities.

•Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The carrying amounts of certain financial instruments of the Company, including accounts receivable, prepaid expenses and other current assets, accounts payable and accrued liabilities, approximate fair value due to their short maturities. The carrying amount of the contingent consideration liability also represents its fair value.

Leases

The Company determines if an arrangement is or contains a lease at contract inception. For leases with an initial term of 12 months or less, a right-of-use (“ROU”) asset, representing the underlying asset during the lease term, and a lease liability, representing the payment obligation arising from the lease, are recognized on the consolidated balance sheet at lease commencement based on the present value of the payment obligation. For operating leases, expense is recognized on a straight-line basis over the lease term. For finance leases, interest expense on the lease liability is recognized using the effective interest method and amortization of the ROU asset is recognized on a straight-line basis over the shorter of the estimated useful life of the asset or the lease term. The Company also has lease arrangements with lease and non-lease components. The Company does not separate non-lease components from lease components for the Company's facility leases. The Company also elected to apply the short-term lease measurement and recognition exemption in which ROU assets and lease liabilities are not recognized for leases with an initial term of 12 months or less.

The present value of lease payments is determined by using the interest rate implicit in the lease, if that rate is readily determinable; otherwise, the Company uses its incremental borrowing rate. The incremental borrowing rate is determined by using the rate of interest that the Company would pay to borrow on a collateralized basis an amount equal to the lease payments for a similar term and in a similar economic environment.

Revenue

The Company recognizes revenue from testing services, product sales, and patient and digital solutions revenue in the amount that reflects the consideration that it expects to be entitled in exchange for goods or services as it transfers control to its customers. Revenue is recorded considering a five-step revenue recognition model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations, and recognizing revenue when, or as, an entity satisfies a performance obligation.

Testing Services Revenue

AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare and AlloSure Lung patient tests are ordered by healthcare providers. The Company receives a test requisition form with payer information along with a collected patient blood sample. The Company considers the patient to be its customer and the test requisition form to be the contract. Testing services are performed in the Company’s laboratory. Testing services represent one performance obligation in a contract and are performed when results of the test are provided to the healthcare provider, at a point in time.

Table of Contents

The healthcare providers that order the tests and on whose behalf the Company provides testing services are generally not responsible for the payment of these services. The first criterion, identify the contracts(s) with a customer, and the second criterion, identify the performance obligations in the contract, of revenue recognition are satisfied when the Company receives a test requisition form with payer information from the healthcare provider. Generally, the Company bills third-party payers upon delivery of an AlloSure Kidney, AlloMap Heart, AlloSure Heart, HeartCare or AlloSure Lung test result to the healthcare provider. Amounts received may vary amongst payers based on coverage practices and policies of the payer. The Company has used the portfolio approach under ASC Topic 606, Revenue from Contracts with Customers, to identify financial classes of payers. Revenue recognized for Medicare and other contracted payers is based on the agreed current reimbursement rate per test, adjusted for historical collection trends where applicable. The Company estimates revenue for non-contracted payers and self-payers using transaction prices determined for each financial class of payers using a history of reimbursements. This includes analysis of the average reimbursement per test and a percentage of tests reimbursed. These estimates require significant judgment.

The Company monitors revenue estimates at each reporting period based on actual cash collections in order to assess whether a revision to the estimate is required. Changes in transaction price estimates are updated quarterly based on actual cash collected or changes made to contracted rates, the Company's discussions with payers, and other pertinent information. In addition, consistent with ASC 606-10-25-1, the Company continues to assess whether it is probable that it will collect substantially all of the consideration to which it will be entitled when determining if a contract with a customer exists.

For the year ended December 31, 2024, the Company recognized $17.4 million in revenue for the tests performed in prior periods, as all performance obligations were satisfied at the time the contract was established.

Product Revenue

Product revenue is recognized from the sale of products to end-users, distributors and strategic partners when all revenue recognition criteria are satisfied. The Company generally has a contract or a purchase order from a customer with the specified required terms, including the number of products ordered. Transaction prices are determinable in the contract. The products are delivered and control is transferred to the customer upon either shipping or delivery, as per the terms of the agreement. There are no further performance obligations related to a contract and revenue is recognized at the point of delivery consistent with the terms of the contract or purchase order.

Patient and Digital Solutions Revenue

Patient and digital solutions revenue is primarily derived from a combination of software as a service (“SaaS”) and perpetual software license agreements entered into with various transplant centers, which are the Company’s customers for this class of revenue. The main performance obligations in connection with the Company’s SaaS and perpetual software license agreements are the following: (i) implementation services and delivery of the perpetual software license, which are considered a single performance obligation, and (ii) post contract support. The Company allocates the transaction price to each performance obligation based on relative stand-alone selling prices of each distinct performance obligation. Digital revenue in connection with perpetual software license agreements is recognized at the point in time when control of the license is transferred and made available for the customer's use and benefit.

Perpetual software license agreements typically require advance payments from customers upon the achievement of certain milestones. The Company records deferred revenue in relation to these agreements when cash payments are received for which the related revenues have not been recognized because one or more of the revenue recognition criteria have not been met, and generally recognizes revenue over the contractual term, as performance obligations are fulfilled.

In addition, the Company derives patient and digital solutions revenue from software subscriptions and medication sales. The Company generally bills software subscription fees in advance. Revenue from software subscriptions is deferred and recognized ratably over the subscription term. The medication sales revenue is recognized based on the negotiated contract price with the governmental, commercial and non-commercial payers with any applicable patient co-pay. The Company recognizes revenue from medication sales when prescriptions are delivered.

Cost of Testing Services

Cost of testing services reflects the aggregate costs incurred in delivering the Company’s testing services. The components of cost of testing services are materials and service costs, direct labor costs, stock-based compensation, equipment and infrastructure expenses associated with testing samples, shipping, logistics and specimen processing charges to collect and transport samples, and allocated overhead including rent, information technology, equipment depreciation, utilities and royalties. Royalties for licensed technology, calculated as a percentage of testing services revenues, are recorded as license fees in cost of testing services at the time the testing services revenues are recognized.

Cost of Product

Table of Contents

Cost of product reflects the aggregate costs incurred in delivering the Company’s products to customers. The components of cost of product are materials costs, manufacturing and kit assembly costs, direct labor costs, equipment and infrastructure expenses associated with preparing kitted products for shipment, shipping, and allocated overhead including rent, information technology, equipment depreciation and utilities. Cost of product also includes amortization of acquired developed technology and adjustments to inventory values, including write-downs of excess or obsolete inventory.

Cost of Patient and Digital Solutions

Cost of patient and digital solutions primarily consists of personnel-related costs associated with developing, installing and maintaining software, depreciation of servers and equipment, amortization of acquired intangible assets, support of the functionality of the software's platforms, including stock-based compensation expenses, cost of prescription drugs and allocated costs of facilities and information technology.

Research and Development Expenses

Research and development expenses, including clinical operations, represent costs incurred to develop diagnostic products and services, high-quality evidence to support the use of the Company’s tests, as well as continued efforts related to improving the Company’s existing products and patient and digital solutions offerings. These expenses include payroll and related expenses, consulting expenses, laboratory supplies, clinical studies and certain allocated expenses as well as amounts incurred under certain collaborative agreements. Research and development costs are expensed as incurred. The Company records accruals for estimated study costs comprised of work performed by contract research organizations based on measure of progress.

Stock-based Compensation

The Company uses the Black-Scholes Model, which requires the use of estimates such as stock price volatility and expected option lives, to value employee stock options. The Company estimates the expected option lives using historical data, estimates volatility using its own historical stock prices, estimates risk-free rates using the implied yield currently available in the U.S. Treasury zero-coupon issues with a remaining term equal to the expected option lives, and estimates dividend yield using the Company’s expectations and historical data. Compensation expense for stock options issued to nonemployees is calculated using the Black-Scholes Model and is recorded over the service performance period using the straight-line attribution method. Options subject to vesting are required to be periodically remeasured over their service performance period, which is generally the same as the vesting period.

The fair value of each restricted stock unit is calculated based upon the closing price of the Company’s common stock on the date of the grant.

The Company uses the straight-line attribution method for recognizing compensation expense. Compensation expense is recognized on awards ultimately expected to vest and reduced for forfeitures that are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Forfeitures are estimated based on the Company’s historical experience.

Income Taxes

The Company accounts for income taxes under the liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.

The Company assesses all material positions taken in any income tax return, including all significant uncertain positions, in all tax years that are still subject to assessment or challenge by relevant taxing authorities. The Company’s assessment of an uncertain tax position begins with the initial determination of the position’s sustainability and is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. As of each balance sheet date, unresolved uncertain tax positions must be reassessed, and the Company will determine whether (i) the factors underlying the sustainability assertion have changed and (ii) the amount of the recognized tax benefit is still appropriate. The recognition and measurement of tax benefits requires significant judgment. Judgments concerning the recognition and measurement of a tax benefit may change as new information becomes available.

Foreign Currency Translation

The functional currency of the Company’s foreign subsidiaries is the local currency for each entity, including the Swedish Krona, Australian dollar and the Euro. The revenue and expenses of such subsidiaries have been translated into U.S. dollars at average exchange rates prevailing during the period. Assets and liabilities have been translated at the rates of exchange on the

Table of Contents

balance sheet date. The resulting cumulative translation adjustments are reported in other comprehensive loss. Foreign currency translation gains and losses on revenue and expenses are recognized in the consolidated statements of operations.

Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss) and other losses affecting stockholders’ equity that, under U.S. GAAP, are excluded from net income or loss. For the Company, such items consist of foreign currency losses on the translation of foreign assets and liabilities.

Recent Accounting Pronouncements

In December 2024, the Company adopted the new segment reporting standard issued by the Financial Accounting Standards Board (“FASB”) under Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires enhanced disclosure of significant segment expenses. All current annual disclosures about a reportable segment’s profit or loss and assets will also be required in interim periods. The new guidance also requires disclosure of the title and position of the Chief Operating Decision Maker (“CODM”) and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. This ASU is effective for the Company’s annual disclosures in fiscal year 2024 and interim-period disclosures in fiscal year 2025. See Note 15, Segment Reporting.

Effective in Future Periods

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 340): Improvements to Income Tax Disclosures, which requires annual disclosures in the rate reconciliation table to be presented using both percentages and reporting currency amounts, and this table must include disclosure of specific categories. Additional information will also be required for reconciling items that meet a quantitative threshold. The new guidance also requires enhanced disclosures of income taxes paid, including the amount of income taxes paid disaggregated by federal, state and foreign taxes and the amount of income taxes paid disaggregated by individual jurisdictions that exceed a quantitative threshold. The amendments should be applied on a prospective basis, but retrospective application is permitted. The amendments set forth in this ASU are effective for annual periods beginning after December 15, 2024 for public entities. This guidance will be effective for the Company’s annual disclosures in fiscal year 2025. The Company is currently evaluating the potential effect that the updated standard will have on its financial statement disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures. This standard requires entities to disaggregate certain costs and expenses into specific categories and by relevant expense caption in the statement of operations. The standard is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. This guidance will be effective for the Company's annual disclosures in fiscal year 2027 and for interim period disclosures beginning in fiscal year 2028. The Company is currently evaluating the impact of adopting of the new standard on its consolidated financial statements and related disclosures.

3. NET INCOME (LOSS) PER SHARE

Basic and diluted net income (loss) per share have been computed by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period.

For the year ended December 31, 2024, common share equivalents have been included in the calculation of diluted net income per share.

For the years ended December 31, 2023 and 2022, all common share equivalents have been excluded from the calculation of diluted net loss per share, as their effect would be antidilutive.

Table of Contents

The following tables set forth the computation of the Company’s basic and diluted net income (loss) per share (in thousands, except shares and per share data):

Year Ended December 31,

Numerator:

Denominator:

Net income (loss) per share:

The following potentially dilutive securities have been excluded from diluted net income (loss) per share because their effect would be antidilutive:

Year Ended December 31,

Shares of common stock subject to outstanding common stock warrants — — 3,132

Table of Contents

4. FAIR VALUE MEASUREMENTS

The following table sets forth the Company’s financial assets and liabilities, measured at fair value on a recurring basis, as of December 31, 2024 and 2023 (in thousands):

Fair Value Measured Using

(Level 1) (Level 2) (Level 3) Total Balance

Assets

Cash equivalents:

Liabilities

Short-term liabilities:

Contingent consideration $ — $ — $ 2,414 $ 2,414

Long-term liabilities:

Contingent consideration — — 174 174

Fair Value Measured Using

(Level 1) (Level 2) (Level 3) Total Balance

Assets

Cash equivalents:

Liabilities

Short-term liabilities:

Contingent consideration $ — $ — $ 5,469 $ 5,469

Long-term liabilities:

Table of Contents

The following table presents the exercise, changes in estimated fair value, additions, deduction and payments of the Company’s Level 3 financial instruments that are measured at fair value on a recurring basis (in thousands):

(Level 3)

Common Stock Warrant Liability and Contingent Consideration

Exercise of warrants (22)

Change in estimated fair value of common stock warrant liability (10)

Additions to contingent consideration 2,269

Payment related to contingent consideration (625)

Deduction from contingent consideration (500)

Payment related to contingent consideration (5,325)

During March 2023, the Company wrote off $1.0 million of its investment in convertible preferred shares of Cibiltech SAS (“Cibiltech”), which was carried at cost. Cibiltech’s operations have been liquidated. The fair value of this investment was based on Level 3 inputs.

In July 2023, the Company entered into a Securities Holders’ Agreement (the “Agreement”) with a private entity based in France. The private entity was established to continue Cibiltech's activity, which consists of designing, developing, publishing, promoting, distributing, and marketing of software related to predictive solutions, monitoring and/or remote monitoring in the field of human organ allotransplantation, allografting, and chronic organ diseases. The private entity retained all assets of Cibiltech, including its licenses. Pursuant to the Agreement, the Company agreed to invest a certain amount in the private entity, in order to continue the commercialization of the iBox technology. In December 2024, the Company made an additional investment. As of December 31, 2024, the Company has invested a total of $1.4 million. The Company's investment is in the form of ordinary and Class B shares carried at cost.

In December 2023, Miromatrix was acquired by United Therapeutics Corporation ("United Therapeutics"). The Company tendered and sold all of its shares of Miromatrix to United Therapeutics in the transaction for $2.5 million. The Company recognized a $1.5 million gain from the disposal of Miromatrix and recorded it as other income (expense), net, on the consolidated statements of operations for the year ended December 31, 2023. The Company received contingent value rights from United Therapeutics which will expire on December 31, 2025.

In determining fair value, the Company uses various valuation approaches within the fair value measurement framework. The valuation methodologies used for the Company’s instruments measured at fair value and their classification in the valuation hierarchy are summarized below:

•Money market funds – Investments in money market funds are classified within Level 1. Money market funds are valued at the closing price reported by the fund sponsor from an actively traded exchange. At December 31, 2024 and 2023, money market funds were included as cash and cash equivalents in the consolidated balance sheets.

•Contingent consideration –Contingent consideration is classified within Level 3. Contingent consideration relates to assetacquisitions and business combinations. The Company recorded the estimate of the fair value of the contingent consideration based on its evaluation of the probability of the achievement of the contractual conditions that would result in the payment of the contingent consideration. Contingent consideration was estimated using the fair value of the milestones to be paid if the contingency is met based on management’s estimate of the probability of success and projected revenues for revenue-based considerations at discounted rates ranging from 7% to 12% at December 31, 2024 and 6% to 12% at December 31, 2023. The significant input in the Level 3 measurement that is not supported by market activity is the Company’s probability assessment of the achievement of the milestones. The value of the liability is subsequently remeasured to fair value at each reporting date, and the change in estimated fair value is recorded as income or expense within operating expenses in the consolidated statements of operations until the milestones are paid, expire

Table of Contents

or are no longer achievable. Increases or decreases in the estimation of the probability percentage results in a directionally similar impact to the fair value measurement of the contingent consideration liability. The carrying amount of the contingent consideration liability represents its fair value.

•Common stock warrant liability – Common stock warrant liability is classified within Level 3. The Company utilizes intrinsic value to estimate the fair value of the warrants. The intrinsic value is computed as the difference between the fair value of the Company’s common stock on the valuation date and the exercise price of the warrants. Increases (decreases) in the Company’s stock price result in a directionally similar impact to the fair value of the common stock warrant liability.

Table of Contents

5. CASH AND MARKETABLE SECURITIES

Cash, Cash Equivalents and Restricted Cash

A reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets to the amount reported within the consolidated statements of cash flows is shown in the table below (in thousands):

Marketable Securities

All short-term marketable securities were considered held-to-maturity at December 31, 2024 and 2023. The Company determined that it had the positive intent and ability to hold until maturity all short-term marketable securities that have been in a continuous loss position. The Company assesses whether the decline in value of short-term marketable securities is temporary or other-than-temporary. In making its assessment, the Company evaluates the current market and interest rate environment as well as specific issuer information. There has been no recognition of any other-than-temporary impairment at December 31, 2024 and 2023.

The amortized cost, unrealized holding gains, and fair value of the Company’s marketable securities by major security type at each balance sheet date are summarized in the tables below (in thousands):

Amortized Cost Unrealized Holding Gains Fair Value

Short-term marketable securities:

Amortized Cost Unrealized Holding Gains Fair Value

Short-term marketable securities:

6. BUSINESS COMBINATIONS AND ASSET ACQUISITION

Business Combinations

HLA Data Systems

In January 2023, the Company acquired HLA Data Systems, a Texas-based company that provides software and interoperability solutions for the histocompatibility and immunogenetics community. The Company acquired HLA Data Systems with a combination of cash consideration paid upfront and contingent consideration with a fair value of $1.3 million.

The Company accounted for the transaction as a business combination using the acquisition method of accounting. Acquisition-related costs of $0.4 million associated with the acquisition were expensed as incurred, and classified as part of general and administrative expenses in the consolidated statements of operations.

Goodwill of $2.1 million arising from the acquisition primarily consists of synergies from integrating HLA Data Systems’ technology with the current testing and digital solutions offered by the Company. The acquisition of HLA Data Systems will provide a robust and comprehensive Laboratory Information Management System and support the laboratory workflows. None

Table of Contents

of the goodwill is expected to be deductible for income tax purposes. All of the goodwill has been assigned to the Company’s existing operating segment.

The following table summarizes the fair values of the intangible assets acquired as of the acquisition date ($ in thousands):

Estimated Fair Value Estimated Useful Lives (Years)

Customer relationships $ 3,010 13

Developed technology 770 11

Customer relationships acquired by the Company represent the fair value of future projected revenue that is expected to be derived from sales of HLA Data Systems’ products to existing customers. The customer relationships’ fair value has been estimated utilizing a multi-period excess earnings method under the income approach, which reflects the present value of the projected cash flows that are expected to be generated by the customer relationships, less charges representing the contribution of other assets to those cash flows that use projected cash flows with and without the intangible asset in place. The economic useful life was determined based on the distribution of the present value of the cash flows attributable to the intangible asset.

The acquired developed technology represents the fair value of HLA Data Systems’ proprietary software. The trademark acquired consists primarily of the HLA Data Systems brand and markings. The fair value of both the developed technology and the trademark were determined using the relief-from-royalty method under the income approach. This method considers the value of the asset to be the value of the royalty payments from which the Company is relieved due to its ownership of the asset. The royalty rates of 10% and 2% were used to estimate the fair value of the developed technology and the trademark, respectively.

A discount rate of 24% was utilized in estimating the fair value of these three intangible assets.

The pro forma impact of the HLA Data Systems acquisition is not material, and the results of operations of the acquisition has been included in the Company’s consolidated statements of operations from the acquisition date.

MediGO

In July 2023, the Company acquired MediGO, an organ transplant supply chain and logistics company. MediGO provides access to donated organs by digitally transforming donation and transplantation workflows to increase organ utilization. The Company acquired MediGO with a combination of cash consideration paid upfront and contingent consideration with a fair value of $0.3 million.

The Company accounted for the transaction as a business combination using the acquisition method of accounting. Acquisition-related costs of $0.3 million associated with the acquisition were expensed as incurred, and classified as part of general and administrative expenses in the consolidated statements of operations.

Goodwill of $0.6 million arising from the acquisition primarily consists of synergies from integrating MediGO’s technology with the current testing and digital solutions offered by the Company. The acquisition of MediGO will provide a comprehensive software platform that optimizes complex logistics from referral to recovery and during the critical movement of organs and teams and gives organ procurement organizations and transplant centers the ability to unify decentralized stakeholders, coordinate resources and make vital decisions with the goal of increasing organ utilization and improving equity and access to transplantation. None of the goodwill is expected to be deductible for income tax purposes. All of the goodwill has been assigned to the Company’s existing operating segment.

The following table summarizes the fair values of the intangible assets acquired as of the acquisition date ($ in thousands):

Estimated Fair Value Estimated Useful Lives (Years)

Customer relationships $ 810 17

Developed technology 850 12

Customer relationships acquired by the Company represent the fair value of future projected revenue that is expected to be derived from sales of MediGO’s products to existing customers. The customer relationships’ fair value has been estimated utilizing a multi-period excess earnings method under the income approach, which reflects the present value of the projected cash flows that are expected to be generated by the customer relationships, less charges representing the contribution of other

Table of Contents

assets to those cash flows that use projected cash flows with and without the intangible asset in place. The economic useful life was determined based on the distribution of the present value of the cash flows attributable to the intangible asset.

The acquired developed technology represents the fair value of MediGO’s proprietary software. The trademark acquired consists primarily of the MediGO brand and markings. The fair value of both the developed technology and the trademark were determined using the relief-from-royalty method under the income approach. This method considers the value of the asset to be the value of the royalty payments from which the Company is relieved due to its ownership of the asset. The royalty rates of 10% and 2% were used to estimate the fair value of the developed technology and the trademark, respectively.

A discount rate of 25% was utilized in estimating the fair value of these three intangible assets.

The pro forma impact of the MediGO acquisition is not material, and the results of operations of the acquisition have been included in the Company’s consolidated statements of operations from the respective acquisition date.

Combined Consideration Paid

The following table summarizes the consideration paid for HLA Data Systems (final amount) and MediGO (final amount) of the assets acquired and liabilities assumed recognized at their estimated fair value at the acquisition date (in thousands):

Total

Consideration

Cash and contingent consideration $ 6,682

Total consideration $ 6,682

Recognized amounts of identifiable assets acquired and liabilities assumed

Current assets $ 1,413

Identifiable intangible assets 6,120

Current liabilities (1,060)

Other current liabilities (810)

Contingent consideration (1,620)

Other liabilities (7)

Total identifiable net assets acquired 4,036

Total consideration $ 6,682

The allocation of the purchase price to assets acquired and liabilities assumed was based on the fair value of such assets and liabilities as of the acquisition date.

Asset Acquisition

Effective as of August 9, 2023, the Company purchased an asset from a private entity. The asset consists of a licensing agreement with a university institution. See also Note 9, Commitments and Contingencies.

The purchased asset did not meet the definition of a business under ASC Topic 805, Business Combinations, and therefore the Company accounted for the transaction as an asset acquisition. In an asset acquisition, goodwill is not recognized, but rather, any excess consideration transferred over the fair value of the net assets acquired is allocated on a relative fair value basis to the identifiable assets acquired.

Acquisition costs relating to the asset acquired were $2.6 million, comprised of base consideration of $1.8 million, contingent consideration at fair value of $0.5 million and associated transaction costs of $0.3 million. Only one asset was acquired and the entire cost is assigned to the licensing agreement, which is recorded under Intangible assets, net, in the consolidated balance sheets. The licensing agreement has an indefinite life and is presented in notes to the consolidated financial statements under the intangible assets with indefinite lives category.

Table of Contents

7. GOODWILL AND INTANGIBLE ASSETS

Goodwill

On December 1, 2024, the Company performed a qualitative assessment of its reporting unit taking into consideration past, current and projected future earnings, recent trends and market conditions, and its market capitalization. Based on this analysis, the Company concluded that it was more likely than not that the fair value of the reporting unit exceeded its carrying amount. As such, it was not necessary to perform the quantitative goodwill impairment assessment at this time. As of December 31, 2024, 2023 and 2022, there has been no impairment of goodwill.

The following table presents details of the Company’s goodwill as of December 31, 2024 and 2023 (in thousands):

Goodwill acquired — 2,646

Remeasurement adjustment — 167

Intangible Assets

The following table presents details of the Company’s intangible assets as of December 31, 2024 ($ in thousands):

Intangible assets with finite lives:

Acquired in-process technology 1,250 — — 1,250

Favorable license agreement 2,257 — — 2,257

Total intangible assets with indefinite lives 3,507 — — 3,507

The following table presents details of the Company’s intangible assets as of December 31, 2023 ($ in thousands):

Intangible assets with finite lives:

Acquired in-process technology 1,250 — — 1,250

Favorable license agreement 2,726 — — 2,726

Total intangible assets with indefinite lives 3,976 — — 3,976

Table of Contents

As of December 31, 2024, 2023 and 2022, there has been no impairment of intangible assets.

The following table summarizes the Company's amortization expense of intangible assets (in thousands):

Year Ended December 31,

Cost of patient and digital solutions 850 1,039 945

The following table summarizes the Company’s estimated future amortization expense of intangible assets with finite lives as of December 31, 2024 (in thousands):

Table of Contents

8. BALANCE SHEET COMPONENTS

Inventory

Inventory consisted of the following (in thousands):

December 31,

Property and Equipment, Net

Property and equipment consisted of the following (in thousands):

December 31,

Computer and office equipment 5,650 5,609

Less: Accumulated depreciation and amortization (36,942) (32,263)

Depreciation expense was $7.8 million, $7.9 million and $5.2 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Accrued and Other Liabilities

Accrued and other liabilities consisted of the following (in thousands):

December 31,

Laboratory processing fees and materials 3,184 2,890

Travel and expenses 819 —

Accrued shipping expenses 504 335

Deferred payments for intangible assets 250 920

License and other collaboration fees 67 250

Total accrued and other liabilities $ 43,352 $ 45,497

Table of Contents

9. COMMITMENTS AND CONTINGENCIES

Leases

The Company leases its operating and office facilities for various terms under long-term, non-cancelable operating lease agreements in Brisbane, California; Columbus, Ohio; West Chester, Pennsylvania; Flowood, Mississippi; Omaha, Nebraska; Fremantle, Australia; and Stockholm, Sweden.

The Company's facility leases expire at various dates through 2033. In the normal course of business, it is expected that these leases will be renewed or replaced by leases on other properties.

As of December 31, 2024, the carrying value of the ROU asset was $24.3 million. The related current and non-current liabilities as of December 31, 2024 were $6.1 million and $22.3 million, respectively. The current and non-current lease liabilities are included in accrued and other current liabilities and operating lease liability, less current portion, respectively, in the consolidated balance sheets.

Effective March 2024, the Company entered into a sublease agreement with a sub-lessee (a third-party) for office space with a six-year term, commencing on May 1, 2024, for a total of $2.6 million base rent for the duration of the contract.

The following table summarizes the lease cost for the years ended December 31, (in thousands):

December 31,

CDNA US Equity

CDNA · 10-K · period ended 2024-12-31

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CDNA US Equity☆

CDNA · 10-K · period ended 2024-12-31

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

CDNA US Equity