MDXH Q2 2025: ExoDx Acquisition to Add $20M+ Revenue, Propelling 30% Growth Ambition

2025-08-05 | By EarningsIQ Research

MDX Health’s Q2 results mark a pivotal inflection point, as the company achieves its first adjusted EBITDA profitability and unveils the transformative ExoDx acquisition, which is set to add $20 million-plus in annual revenue and accelerate growth to 30% in 2026. The company’s focus on urology diagnostics, disciplined operating leverage, and a tightly integrated sales force underpin a durable growth model. With ExoDx poised to strengthen MDXH’s pathway leadership and cross-sell potential, investors now face a business entering a new phase of scale and margin expansion.

Summary

• ExoDx Acquisition Redefines Growth Trajectory: MDXH expects ExoDx to deliver $20M+ incremental revenue and immediate EBITDA accretion.
• Operating Leverage Without Sales Expansion: Five years of 20%+ growth achieved with stable rep headcount and improving margins.
• 2026 Growth Acceleration in Focus: Management targets 30%+ revenue growth and approaching 10% EBITDA margin next year.

Performance Analysis

MDX Health delivered its seventeenth consecutive quarter of 20% or greater revenue growth, reaching $26.6 million in Q2, while achieving positive adjusted EBITDA for the first time at $1.4 million. Billable test volume expanded 21% year-over-year, split evenly between tissue-based (Confirm MDX, GPS) and liquid-based (Select MDX, Resolve MDX, Germline) tests. Tissue-based test volumes outpaced liquid at 26% growth, a testament to the company’s successful cross-selling and menu adoption efforts post-GPS acquisition.

Gross margin reached 66%, up 6 points year-over-year, driven by favorable test mix and operational efficiencies. Operating loss narrowed sharply, and net loss improved, reflecting robust top-line expansion and cost discipline. Notably, all growth was organic and achieved without expanding the sales team, highlighting the company’s sales channel leverage and territory command.

• Margin Expansion Through Mix and Efficiency: Gross margin gains stemmed from both test mix and operational improvements.
• Sales Force Productivity: Revenue doubled in three years with no increase in rep headcount post-GPS deal.
• Balanced Segment Growth: Both tissue and liquid segments posted high-teens to mid-20s volume growth, with tissue leading.

MDXH’s P&L now reflects a business model with increasing scale, sustainable growth, and clear path to operating profitability, setting the stage for further margin expansion post-ExoDx integration.

Executive Commentary

Strategic Positioning

1. ExoDx Acquisition: Platform Expansion and Market Leadership

The pending acquisition of ExoDx from Biotechnic is positioned as a transformative move, expected to add over $20 million in annual revenue, be immediately accretive to EBITDA, and strengthen MDXH’s pathway offering in prostate cancer diagnostics. ExoDx’s clinical strength and lack of a digital rectal exam (DRE) requirement address market shifts and enable penetration into primary care and home testing. The deal also brings a significant exosome IP library for future cancer applications.

2. Integrated Menu and Cross-Selling Opportunity

MDXH’s strategy is to offer a comprehensive menu that covers every stage of the prostate cancer diagnostic pathway. The ExoDx customer base has limited overlap with existing Confirm and GPS users, enabling immediate cross-sell potential. This mirrors the successful GPS integration, where new customer access and menu adoption drove growth without sales force expansion. Management expects the same dynamic to accelerate both tissue and liquid test adoption.

3. Operating Discipline and Margin Trajectory

Disciplined OpEx management and focus on gross margin accretion have been central to MDXH’s model, with the company doubling revenue in three years and driving gross margins from the 30s to the mid-60s. The ExoDx acquisition will bring additional sales reps and a CLIA lab in Massachusetts, but integration is expected to be seamless and margin accretive, with no major structural changes required.

4. Reimbursement and Guideline Positioning

ExoDx is already included in clinical guidelines and reimbursed at rates similar to Select MDX, providing immediate revenue visibility and reducing reimbursement risk. The acquisition also diversifies MDXH’s laboratory footprint, with three world-class labs now supporting turnaround times, customer service, and payer coverage optimization.

Key Considerations

MDX Health’s Q2 marks a transition from organic, internally driven growth to a platform expansion phase, with the ExoDx acquisition set to reshape the revenue base and margin profile. The company’s execution track record, menu strategy, and ability to scale without adding sales headcount are material differentiators in the precision diagnostics landscape.

Key Considerations:

• Menu Expansion Drives Durable Growth: The addition of ExoDx and prior GPS integration demonstrate MDXH’s ability to use M&A for step-change growth and cross-sell leverage.
• Sales Channel Efficiency: Five years of 20%+ growth with a stable sales force highlights territory command and adoption depth.
• Margin Accretion from Mix and Scale: Gross margin gains are tied to higher ASP, payer coverage, and operational efficiency; ExoDx is expected to further accrete margins.
• Platform Optionality from Exosome IP: The acquired IP portfolio enables future expansion into other cancers, providing long-term optionality beyond prostate diagnostics.

Risks

Integration of ExoDx, while expected to be seamless, still carries execution risk around sales team assimilation, customer transition, and laboratory harmonization. Market shifts away from SELECT and toward home-based, DRE-free testing could accelerate faster than anticipated, requiring rapid adaptation. Reimbursement dynamics, although stable for now, remain a structural risk if Medicare or commercial rates shift or guideline inclusion changes. Management’s confidence in 30%+ growth for 2026 is contingent on successful cross-sell realization and minimal disruption from competitive or regulatory moves.

Forward Outlook

For Q4 2025, MDX Health guided to:

• Accretive adjusted EBITDA post-ExoDx closing, with integration expected to be completed in September.
• More detailed financial impact guidance for ExoDx to be provided with Q3 results in November.

For full-year 2026, management signaled:

• Revenue growth exceeding 30%, with ExoDx contributing over $20 million incremental revenue.
• Adjusted EBITDA margin approaching 10%, reflecting scale and mix benefits.

Management emphasized confidence in sustained high-teens to 20%+ organic growth, with the ExoDx platform accelerating both revenue and margin expansion. Investors should monitor customer transition, sales force integration, and early signs of cross-sell traction as the deal closes.

Takeaways

MDX Health’s Q2 2025 results and ExoDx acquisition signal a business moving from repeatable organic growth to a platform-driven, margin-expansive model. The company’s disciplined execution, menu strategy, and sales force leverage provide a sturdy base for further acceleration.

• Transformative Acquisition: ExoDx adds scale, margin, and cross-sell potential, positioning MDXH as the only provider covering the full prostate cancer diagnostic pathway.
• Operating Model Leverage: Five years of 20%+ growth with a stable sales force and expanding gross margins validate the company’s execution discipline.
• 2026 Growth Inflection: Investors should look for confirmation of revenue acceleration above 30% and margin expansion as ExoDx integration progresses and cross-selling materializes.

Conclusion

MDX Health’s Q2 marks a strategic pivot, as the company leverages its proven operating model and menu expansion to enter a new phase of growth and profitability. The ExoDx acquisition, with its immediate revenue and margin impact, positions MDXH as the clear leader in precision urology diagnostics, with platform optionality and execution momentum heading into 2026.

Industry Read-Through

The MDXH-ExoDx deal highlights a broader industry pivot toward integrated pathway solutions and menu consolidation in molecular diagnostics, especially in high-growth specialty verticals like urology. The shift away from DRE-dependent testing and toward home-based, minimally invasive diagnostics is accelerating, pressuring legacy test providers and forcing menu evolution. Sales channel leverage and cross-sell execution are emerging as key differentiators, with scale and margin expansion increasingly tied to platform breadth and customer overlap. Investors should watch for further M&A and menu expansion moves across precision diagnostics, as companies race to own the full patient journey and secure payer coverage in competitive, guideline-driven markets.

MDXH Healthcare Diagnostics Urology Acquisition Cross-selling Margin Guideline