Exact Sciences (EXAS) Q3 2025: Screening Revenue Jumps 22% as Cologuard Plus Adoption Accelerates
Exact Sciences delivered its strongest quarterly growth in over two years, propelled by Cologuard Plus adoption and record care gap program demand. The company raised full-year guidance and signaled growing operational leverage, while new product launches in multi-cancer detection and MRD are laying the groundwork for future expansion. Investors now face a business with increasing scale, deepening payer relationships, and a robust innovation pipeline, but must monitor execution on new product ramp and payer conversion as the next leg of growth unfolds.
Summary
- Cologuard Plus Momentum: Rapid payer coverage and pricing gains are shifting the screening mix and driving higher ASPs.
- Operational Leverage Expands: Free cash flow and EBITDA margins improved, reflecting cost discipline and scale benefits.
- Pipeline Execution Critical: Success in multi-cancer detection and MRD will determine future revenue diversity.
Performance Analysis
The third quarter saw Exact Sciences deliver 20% total revenue growth, led by a 22% surge in screening revenue to $666 million, marking the fastest pace in more than two years. Cologuard, the company’s flagship stool-based colorectal cancer test, benefited from both increased payer adoption and record care gap shipments, which target unscreened populations through payer partnerships. Precision oncology, which includes Oncotype DX and related cancer diagnostics, grew 12% on a core basis, with international and U.S. volumes both up.
Adjusted EBITDA rose 37% year-over-year to $135 million, with margins expanding by 200 basis points to 16%. Free cash flow generation was a standout, up 270% year-to-date, driven by improved collections and working capital efficiencies linked to the Cologuard Plus launch. Gross margins dipped 100 basis points, a temporary effect from the care gap program’s timing, but are expected to rebound in Q4 as shipment cadence normalizes.
- Cologuard Plus Drives Mix Shift: Four of the top 10 payers and Medicare now contracted, representing 30% of screening volume exiting the year.
- Care Gap Expansion: Record shipments to payers boosted volumes but temporarily diluted gross margin.
- Precision Oncology Broadens: Oncotype DX continues to anchor growth, but new launches like OncoDetect are not yet material to results.
Operational improvements, territory realignments, and AI-powered sales tools contributed to record ordering provider counts and increased new provider onboarding, further fueling the top-line. The company’s ExactNexus platform, a patient data integration and workflow system, underpins these gains by streamlining test adoption and compliance.
Executive Commentary
"The iconic Cologuard brand is recognized by more than 90% of consumers. This brand awareness is driving increased adoption of Cologuard among the 55 million Americans who are not up to date with colorectal cancer screening."
Kevin Conroy, Chairman and Chief Executive Officer
"Operating leverage is expanding, and cash generation continues to strengthen. We are well-positioned to achieve our 2027 financial targets and create long-term value."
Aaron Bloomer, Chief Financial Officer
Strategic Positioning
1. Cologuard Plus: Payer Conversion and Market Penetration
Cologuard Plus, the next-generation non-invasive colorectal cancer screening test, is rapidly gaining traction with both payers and providers. Four of the top 10 payers plus Medicare have now contracted, and the company is actively negotiating with the remaining major plans. Management confirmed plans to sunset the legacy Cologuard test in 2026, further consolidating volume and pricing power around the superior test. ASP uplift from Cologuard Plus is expected to contribute 300 to 400 basis points to screening growth in Q4, with contracted payers representing 30% of volume as the year closes.
2. Care Gap Programs: Volume Engine and Margin Tradeoff
Care Gap programs, partnerships with payers to target unscreened populations, delivered record volume in Q3. While these shipments carry slightly lower gross margins, they are accretive to the bottom line and expand Exact’s reach into previously hard-to-engage patient segments. Management expects these programs to remain back-half weighted, with volume-driven margin volatility offset by longer-term compliance and re-screening tailwinds.
3. Pipeline Execution: Multi-Cancer and MRD Launches
The launch of CancerGuard, a multi-cancer early detection blood test, marks a significant step in expanding Exact’s diagnostic footprint beyond colorectal cancer. Early results are promising, but management does not expect material revenue contribution in 2025. OncoDetect, the minimal residual disease (MRD) test, is gaining initial traction in breast and colorectal cancer, with evidence generation and payer coverage as key next steps. The company’s multi-omic platform and deep provider relationships are positioned as competitive differentiators as these new modalities ramp.
4. Commercial Engine and Technology Platform
ExactNexus, the company’s integrated patient and provider workflow platform, continues to drive operational efficiency and compliance, enabling innovations like customer-initiated ordering (CIO) and seamless integration with electronic health records. Record provider onboarding and territory realignment, supported by AI-powered tools, have energized the sales force and accelerated new product adoption.
Key Considerations
This quarter’s results reflect Exact’s ability to execute on multiple growth levers while managing operational complexity and margin volatility. The evolving product mix, payer dynamics, and innovation pipeline present both opportunities and challenges as the company targets its 2027 goals.
Key Considerations:
- Cologuard Plus Conversion Pace: The rate at which remaining payers contract and the effectiveness of the legacy test sunset will shape 2026 revenue and ASP trajectory.
- Care Gap Program Scalability: Sustaining volume growth while improving compliance rates will determine long-term value creation from these partnerships.
- Pipeline Ramp and Evidence Generation: CancerGuard and OncoDetect must secure payer coverage and clinical adoption to become material contributors.
- Operational Leverage Sustainability: Continued progress on cost savings and working capital is critical to reaching targeted EBITDA margins and free cash flow goals.
Risks
Payer conversion risk remains elevated, as six of the top 10 commercial payers have yet to contract for Cologuard Plus, and the timing of full transition is uncertain. Care gap program margin dilution could persist if volume growth outpaces compliance improvements. Pipeline execution risk is material, with new product launches in multi-cancer and MRD requiring both clinical validation and payer adoption to scale. Regulatory delays or reimbursement headwinds for new tests could disrupt the growth narrative.
Forward Outlook
For Q4 2025, Exact Sciences guided to:
- Sequential screening ASP increase, driven by Cologuard Plus mix
- Lower care gap shipment volume, supporting gross margin recovery
For full-year 2025, management raised guidance:
- Total revenue between $3.22 and $3.235 billion
- Screening revenue between $2.51 and $2.52 billion (20% growth at midpoint)
- Precision oncology revenue between $710 and $715 million (9% growth at midpoint)
- Adjusted EBITDA between $470 and $480 million (14.7% margin at midpoint)
Management emphasized continued payer contracting for Cologuard Plus, the ramp of CancerGuard and OncoDetect, and further productivity gains as key drivers into 2026.
- Focus on expanding payer coverage for new products
- Continued investment in sales and marketing, especially for CancerGuard
Takeaways
Exact Sciences is executing across core and emerging segments, with Cologuard Plus and care gap programs driving near-term growth and a robust innovation pipeline targeting future expansion.
- Screening Flywheel Accelerates: Cologuard Plus adoption, payer wins, and care gap volumes are compounding, but full conversion and compliance gains remain works in progress.
- Margin and Cash Flow Strength: Operational leverage is improving, with cost savings and working capital initiatives supporting rising EBITDA and free cash flow.
- Pipeline Ramp Key for 2026: Investor focus will shift to the pace of CancerGuard and OncoDetect ramp, payer adoption, and evidence generation as these products move beyond early launch phases.
Conclusion
Exact Sciences delivered a breakout quarter, raising guidance and demonstrating commercial and operational discipline. The strategic transition to Cologuard Plus, expansion of care gap programs, and early pipeline execution set the stage for multi-year growth, but sustained payer conversion and new product ramp will be critical to maintaining momentum.
Industry Read-Through
Exact’s success in driving payer adoption and screening volume through care gap programs signals a structural shift in how diagnostics companies can partner with payers to close preventive care gaps. The rapid transition to next-generation tests like Cologuard Plus raises the bar for clinical performance and pricing power across diagnostics. Multi-cancer and MRD pipeline launches reinforce the importance of evidence generation and payer engagement for emerging oncology diagnostics. Competitors and adjacent players should watch for accelerating product life cycles, payer-driven adoption, and the operational value of integrated data platforms as the sector evolves.