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Shareholders’ Equity and Equity Compensation | 6 Months Ended
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Jun. 30, 2025
Equity [Abstract] |
Shareholders’ Equity and Equity Compensation | Shareholders’ Equity and Equity Compensation Preferred Stock In connection with the IPO, the Company's amended and restated certificate of formation became effective, which authorized the issuance of 100,000,000 shares of preferred stock with a par value of $0.001 per share. As of June 30, 2025, there were no shares of preferred stock issued and outstanding. Common Stock As of June 30, 2025 and December 31, 2024, 2,800,000,000 and 1,150,000,000 shares of common stock with a $0.001 par value were authorized, respectively. There were 281,090,538 and 35,842,319 shares outstanding at June 30, 2025 and December 31, 2024, respectively. Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company's shareholders. Common shareholders are entitled to receive dividends if and when declared by the Company's board of directors, subject to the preferential dividend rights of any preferred stock then outstanding and compliance with our contractual obligations. No dividends have been declared or paid by the Company since its inception. Treasury Stock During the six months ended June 30, 2025, the Company repurchased 1,438,138 shares of common stock for an amount of $16.6 million, mainly associated with previously early-exercised options. Refer to below under “Option Activity —Modifications to Stock Options” for further details. No common shares were repurchased during the year ended December 31, 2024. Repurchased common stock is shown on the condensed consolidated balance sheets and condensed consolidated statements of redeemable convertible preferred stock and shareholders' deficit as treasury stock. The Company had 1,620,638 and 182,500 shares of treasury stock as of June 30, 2025 and December 31, 2024, respectively. These shares have not been retired. The Company has not issued any shares of treasury stock as of June 30, 2025 and December 31, 2024. 2020 Incentive Plan Pursuant to the 2020 Incentive Plan (the "2020 Plan"), the Company may grant awards of options, restricted awards, performance awards or share appreciation rights to employees, consultants, and directors of the Company. A total of 24,788,884 shares of common stock are reserved for issuance upon the exercise of all awards granted or available to be granted under the 2020 Plan as of June 30, 2025. In June 2025, in connection with the IPO and the adoption of the 2025 Plan (as defined below), the Company will not make any additional grants under the 2020 Plan. Any outstanding awards granted under the 2020 Plan remain subject to the terms of the 2020 Plan, and any shares underlying outstanding wards under the 2020 Plan that expire or are repurchased, forfeited, canceled, or withheld will become available for issuance under the 2025 Plan. To the extent permitted by applicable laws or any exchange rule, any shares of common stock issued under this Plan that are issued (a) in connection with the Company's acquisition of an unaffiliated business entity, (b) to the employees of such entity, and (c) in substitution of equity incentive awards previously issued to such employees by such entity shall not reduce the number of shares of common stock available for issuance under the Plan. 2025 Incentive Plan Effective May 23, 2025, the Company’s Board of Directors adopted, and the shareholders approved, the 2025 Incentive Plan (the “2025 Plan”). The 2025 Plan provides for the grant of incentive stock options (“ISOs”), nonstatutory stock options (“NSOs”), share appreciation rights, restricted awards, performance awards, and other awards. As of June 30, 2025, a total of 4,127,172 shares of common stock were reserved for issuance in settlement of awards granted under the 2025 Plan. The material terms of the 2025 Plan are substantially similar to the 2020 Plan, except with respect to the number of authorized shares, which initially equaled 15,125,002 shares, plus the number of shares that would return to the share reserve of the 2020 Plan following the pricing of the Company's initial public offering. The 2025 Plan’s share reserve will increase on January 1 of each calendar year during the term of the 2025 Plan, beginning in 2026, by a number of shares as determined by the administrator of the 2025 Plan and in consultation with the Company, provided, that such increase (if any) will be no greater than the amount by which (y) 4% of the aggregate number of outstanding shares of our common stock as of the last day of the immediately preceding fiscal year exceeds (z) the aggregate number of shares remaining available for grant under the 2025 Plan on the last day of the immediately preceding fiscal year. Employee Stock Purchase Plan The Company’s Board of Directors has adopted, and the shareholders approved, the 2025 Employee Stock Purchase Plan (the “ESPP”), which became effective in connection with the IPO. The ESPP enables eligible employees to purchase shares of the Company’s common stock with payroll deductions. A total of 2,571,250 shares of the Company’s common stock were initially reserved for issuance under the ESPP. The number of shares reserved for issuance and sale under the ESPP will increase automatically on January 1 of each calendar year during the term of this Plan beginning in 2026, by a number of Shares equal to 1% of the Common Stock outstanding on the last day of the immediately preceding fiscal year, unless the ESPP administrator should decide to increase the number of shares available under the ESPP by a lesser amount. The purchase price designated by the ESPP administrator will be no less than the lower of 85% of the closing trading price per share of our common stock on the first trading date of an offering period in which a participant is enrolled or 85% of the closing trading price per share on the purchase date, which will occur on the last trading day of each purchase period within an offering period. The initial enrollment and offering periods have not begun as of June 30, 2025. Option Activity Under the Plan, the Company has granted incentive stock options and non-qualified stock options to its employees and other service providers (non-employees). Most of the Company’s stock options vest incrementally over five years, subject to the grantee's continuous employment with the Company (“time-vesting options”). The Company recognizes compensation cost on a straight-line basis over the requisite service period for its time-vesting options. In addition to its time-vesting options, the Company has also granted stock options to certain non-employees for which vesting is tied to the grantee’s performance (“performance-vesting options”). The Company evaluates whether it is probable that the performance metric will be achieved for its performance-vesting options and recognizes compensation cost on a straight-line basis over the implied service period if achievement of the performance metric is deemed probable. No option shall be exercisable after the expiration of 10 years from the date it was granted. The exercise price of each option shall be not less than 100.0% of the fair market value of the common stock subject to the option on the date the option is granted. The following tables summarize the Company's stock option activity during the six months ended June 30, 2025:
| Options Outstanding
|  |  | Weighted |  | Weighted |  |
|  |  | Average |  | Average |  |
|  |  | Exercise |  | Remaining |  | Aggregate
| Number of |  | Price |  | Contract |  | Intrinsic
| Options |  | Per Share |  | Term |  | Value
|  |  |  |  | (in years) |  | (in thousands)
Total outstanding as of December 31, 2024: | 21,770,225 |  | $ | 9.06 |  |  | 5.40 |  | $ | 226,117 |
Granted | 3,085,295 |  | 18.79 |  |  |  |  | 1,040 |
Exercised | (686,254) |  | 6.14 |  |  |  |  | 12,613 |
Cancelled/forfeited | (665,134) |  | 12.56 |  |  |  |  | 6,292 |
Expired | (156) |  | 2.44 |  |  |  |  | 4 |
Total outstanding as of June 30, 2025 | 23,503,976 |  | $ | 10.33 |  |  | 5.55 |  | $ | 348,605 |
Total exercisable as of June 30, 2025 | 17,018,261 |  | $ | 7.53 |  |  | 4.37 |  | $ | 299,962 |
Total vested or expected to vest as of June 30, 2025 | 22,478,922 |  | $ | 9.99 |  |  | 5.41 |  | $ | 341,097 |
| Unvested/Vested Activity
|  |  |  |  | Weighted |  |
|  |  | Weighted |  | Average |  |
|  |  | Average |  | Grant Date |  | Average
|  |  | Exercise |  | Fair |  | Remaining
| Options |  | Price |  | Value |  | Life
|  |  |  |  |  |  | (in years)
Unvested outstanding, as of December 31, 2024 | 6,658,321 |  |  | $ | 15.79 |  |  | $ | 9.39 |  |  | 3.30
Granted | 3,085,295 |  |  | 18.79 |  | 15.43 |  |
Cancelled/forfeited | (362,227) |  |  | 15.52 |  | 9.62 |  |
Vested, outstanding shares | (2,203,174) |  |  | 14.41 |  | 8.88 |  |
Unvested outstanding, as of June 30, 2025 | 7,178,215 |  | 17.52 |  | 12.13 |  | 3.34
Early exercised unvested, end of period | 43,605 |  |  | $ | 16.20 |  |  | $ | 10.37 |  |  |
Aggregate intrinsic value represents the difference between the estimated fair value of the underlying common stock and the exercise price of outstanding, in-the-money options. The weighted average grant date fair value of options granted during the three months ended June 30, 2025 and 2024 was $14.02 and $11.76 per option, respectively, and $15.43 and $11.76 per option for the six months ended June 30, 2025 and 2024, respectively. The total grant date fair value of options vested was $5.2 million and $3.5 million during the three months ended June 30, 2025 and 2024, respectively, and $19.6 million and $4.8 million for the six months ended June 30, 2025 and 2024, respectively. The total intrinsic value of options exercised was $10.8 million and $1.1 million during the three months ended June 30, 2025 and 2024, respectively, and was $12.6 million and $1.5 million during the six months ended June 30, 2025 and 2024, respectively. Modification to stock options On November 9, 2021 and February 23, 2022, the Company granted stock options to certain executives that are exercisable upon vesting for 331,250 shares and 2,000,000 shares of the Company’s common stock, respectively (the "Prior Stock Options"). The Prior Stock Options vested over five years. On August 11, 2022, the Company’s Compensation Committee approved a modification to the Prior Stock Options, which was communicated to holders of the Prior Stock Options on September 1, 2022. The modification reduced the exercise price to $16.20 and modified the vesting conditions such that 20.0% vest upon grant, while the remainder vest over the following four years. The total number of grantees affected by this modification was twelve. The modification was not mandatory, but rather could be elected by holders of the Prior Stock Options on an individual holder basis. If the holder elected to participate, the holder’s Prior Stock Options were immediately canceled, and the Company issued the holder an equivalent number of new stock options in exchange (the “New Stock Options”) which could be early exercised prior to vesting. All of the holders elected to participate in the modification and exchanged their Prior Stock Options for New Stock Options. In addition, as an alternative to paying cash, holders of the New Stock Options that elected to exercise their options were able to pay for the exercise price by executing a full recourse promissory note with the Company that is secured by the holder’s restricted shares that are issued upon early exercise. Five grantees elected to early exercise 1,530,000 options utilizing the promissory note. The principal of each note was equal to the exercise price of the New Stock Options. Interest on the unpaid balance compounded annually and accrued at a fixed rate per annum equal to the mid-term applicable federal rate in effect on the issuance of the note. The maturity date of the notes was the earlier of (1) December 31, 2030 or (2) the occurrence of a change in control event, unless an acceleration event occurs sooner. An acceleration event would generally occur if required to ensure compliance with Section 402 of the Sarbanes-Oxley Act of 2022, the termination of the holder's employment, the insolvency of the holder or the breach of any warranty of the holder. The holder may elect to prepay the outstanding principal and accrued interest balance of the promissory note at any time without penalty. In addition to the outstanding balance of the note becoming due and payable immediately, upon the occurrence of an acceleration event, if the holder defaults on payment of the note, then interest would accrue at the maximum rate permitted by applicable law. The Company would have full recourse against the holder for failure to pay the note as and when due. Such promissory notes were secured by the restricted shares issued to the holder that were underlying the note. If the note is not repaid upon an event of default or acceleration event, the Company had the right to repurchase the restricted shares issued upon the exercise of the note for fair market value, which proceeds will apply to repayment of the note (with any remaining balance remaining due). The Company accounted for the modification as a Type I (Probable to Probable) modification under ASC 718 that does not change the classification of the award (i.e., the New Stock Options continue to be classified within equity). The Company calculated the fair value of the Prior Stock Options and New Stock Options immediately prior to and after the modification using the Black-Scholes option pricing model. The incremental fair value was added to the original unrecognized compensation cost to arrive at the new unrecognized compensation cost, to be recognized over the remaining requisite service period. Unvested stock received from early exercises of the New Stock Options are subject to a right of repurchase at the lesser of (i) original issuance price or (ii) then-current fair market value in the event of the employee's termination, either voluntary, or involuntary. The Company’s repurchase right with respect to these shares typically lapse over four years as the shares become vested. Early exercises of stock options are not deemed to be substantive exercises for accounting purposes and accordingly, consideration received for exercises of unvested stock options is initially recorded as a liability and subsequently reclassified into shareholders’ deficit as the related shares vest. As of June 30, 2025 and December 31, 2024, 43,605 and 662,000 shares from options exercised to date were subject to repurchase at a price of $16.20 per share. Of the amount subject to repurchase as of June 30, 2025 and December 31, 2024, $0.3 million and $5.0 million was recorded within other accrued expenses and current liabilities, respectively, and $0.4 million and $5.8 million was recorded within other long-term liabilities on the condensed consolidated balance sheets, respectively. In addition, as the early exercise was performed via issuance of a promissory note, a corresponding debt amount, plus related interest income was recorded as contra-equity. The total amount presented as contra-equity as of December 31, 2024 was $26.5 million, which includes interest income and the impact from exercises of both the vested portion of the New Stock Options and early exercises. On March 3, 2025, the Company repurchased 1,429,213 common stock shares issued upon early exercise of stock options at $18.60 per share and proceeds were used to pay off the promissory notes and accrued interests. Repurchased common stock shares included 810,816 and 618,397 common stock shares, respectively, that were for options vested and unvested at the time of the repurchase, respectively. On the same day, the Company granted 1,530,000 new stock options to the same employees. New options were issued at an exercise price of $18.60 per share, have the same vesting status as cancelled options and are not early exercisable. The other terms of the new options are substantially the same as the original options. The Company accounted for the repurchase of the shares and grant of the new options as a Type I (Probable to Probable) modification under ASC 718. The Company calculated the fair value of the original options and new options immediately prior to and after the modification using the Black-Scholes option pricing model based on the following assumptions: risk-free interest rate of 3.93% - 3.99%; dividend yield of 0.00%; stock price volatility of 68.96% - 69.48%; and an expected life of 5.0 - 5.3 years. The total incremental fair value was $15.1 million, of which $8.6 million corresponding to the vested options was immediately recognized as compensation expense, with the remaining $6.5 million and the original unrecognized compensation cost of $5.7 million being recognized over the remaining requisite service period. Restricted Awards Activity The Company grants restricted stock units that will be settled in shares of the Company's common stock upon vesting to its employees, consultants and non-employee directors. Vesting of the restricted stock units granted prior to the IPO was generally contingent upon the Company completing either an initial public offering of its common stock or a change of control. Vesting of restricted stock units granted after the IPO generally occurs incrementally over four years, subject to the grantee's continuous service with the Company. The following table summarizes the Company's restricted stock unit activity for the six months ended June 30, 2025:
|  |  | Weighted
| Number of |  | Average Grant
| Restricted Stock Units |  | Date Fair Value
Unvested as of December 31, 2024 | 762,500 |  | $ | 18.19 |
Granted | 4,657,014 |  | $ | 20.73 |
Vested | (1,048,250) |  | $ | 18.60 |
Cancelled/forfeited | (7,802) |  | $ | 21.00 |
Unvested as of June 30, 2025 | 4,363,462 |  | $ | 20.88 |
Stock-Based Compensation Expense The Company recorded stock-based compensation expense in the condensed consolidated statements of operations and comprehensive loss as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30, |
| 2025 |  | 2024 |  | 2025 |  | 2024 |  |  |  |  |
| (amounts in thousands)
Cost of services - Molecular profiling services | $ | 882 |  |  | $ | 399 |  |  | $ | 1,348 |  |  | $ | 826 |  |  |  |  |  |
Cost of services - Pharma research and development services | 2 |  |  | 2 |  |  | 3 |  |  | 4 |  |  |  |  |  |
Selling and marketing expense | 1,990 |  |  | 967 |  |  | 3,232 |  |  | 2,085 |  |  |  |  |  |
General and administrative expense | 22,392 |  |  | 2,053 |  |  | 33,027 |  |  | 3,998 |  |  |  |  |  |
Research and development expense | 3,027 |  |  | 1,064 |  |  | 5,374 |  |  | 2,030 |  |  |  |  |  |
Total | $ | 28,293 |  |  | $ | 4,485 |  |  | $ | 42,984 |  |  | $ | 8,943 |  |  |  |  |  |
There was no tax benefit associated with the above stock-based compensation expense. Valuation of Stock-Based Awards The Company records stock-based compensation expense for stock-based awards based on the estimated fair value of the awards on the date of the grant. The Company estimates the fair value of stock options using a Black-Scholes option pricing model. Prior to the IPO, the absence of a public market for the Company’s common stock required the Company’s Board of Directors to estimate the fair value of its common stock for purposes of granting options and for determining stock-based compensation expense by considering several objective and subjective factors, including contemporaneous third-party valuations, actual and forecasted operating and financial results, market conditions and performance of comparable publicly traded companies, developments and milestones in the Company, the rights and preferences of common and convertible preferred stock, transactions involving the Company’s common stock, and assumptions for a discount for lack of marketability. The fair value of the Company’s common stock was determined in accordance with the applicable elements of the American Institute of Certified Public Accountants Accounting and Valuations Guide, Valuation of Privately Held Company Equity Securities Issued as Compensation. The key assumptions used in determining the fair value of options granted and a summary of the methodology applied to develop each assumption are as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30, |
| 2025 |  | 2024 |  | 2025 |  | 2024 |  |  |  |  |
Expected volatility | 68.3% |  | 62.5% - 63.2% |  | 68.3% - 69.5% |  | 62.5% - 63.2% |  |  |  |  |
Risk-free interest rate | 4.2% |  | 4.4% - 4.6% |  | 3.9% - 4.2% |  | 4.4% - 4.6% |  |  |  |  |
Expected term (years) | 6.50 |  | 5.97 - 6.55 |  | 5.00 - 6.55 |  | 5.97 - 6.55 |  |  |  |  |
Expected dividend rate | —% |  | —% |  | —% |  | —% |  |  |  |  |
Expected forfeiture rate | 8.5% |  | 8.5% |  | 0.0% - 8.5% |  | 8.5% |  |  |  |  |
Expected volatility. This is a measure of the amount by which the share price has fluctuated or is expected to fluctuate. An increase in the expected price volatility will increase the fair value of the option granted and the related compensation expense. As the Company was not publicly traded prior to June 2025, the expected price volatility for the Company's options was determined by using an average of historical volatilities of selected industry peers deemed to be comparable to the business corresponding to the expected term of the awards. Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for U.S. Treasury notes with maturities corresponding to the expected term of the awards. Expected term. This is the period of time over which the options granted are expected to remain outstanding and is based on the Company’s estimate, taking into consideration vesting term, contractual term and historical actual lives. Options granted have a maximum term of ten years. An increase in the expected life will increase the fair value of the option granted and the related compensation expense. Due to the lack of historical share option exercise data, the Company utilizes the simplified method for determining the expected term. Dividend rate. The Company has not made any dividend payments, nor does it have plans to pay dividends in the foreseeable future. Therefore, an expected dividend yield of zero is utilized. Forfeitures. Forfeitures are estimated at the time of grant and reduce compensation expense ratably over the vesting period. This estimate is adjusted periodically based on the extent to which actual forfeitures differ, or are expected to differ, from the previous estimate

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- Definition The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP). + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/718/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 505 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/505/tableOfContent + Details
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