CARLSBAD, Calif., July 31 Genoptix, Inc.(Nasdaq: GXDX), a specialized laboratory services provider, today reportedrevenues of $27.8 million for the second quarter of 2008 and $50.1 million forthe first half of 2008, as compared to revenues of $13.9 million and$24.6 million for the respective periods in 2007. Stated revenue for thefirst half of 2008 included a $1.3 million benefit from changes in accountingestimates relating to prior periods.
"Our strong performance in the first half of the year resulted in growthin all segments, as revenues increased by 99% over the second quarter of 2007and 104% over the first half of last year," said Tina Nova Bennett, Ph.D.,President and CEO of Genoptix. "Expanding our sales efforts and improving ourability to provide high quality diagnostic services to a wider audiencecontinues to drive customer growth nationwide. Higher case volumes reflectthe success of these initiatives, increasing 77% year-over-year to more than9,300 cases since the beginning of April, our sixteenth consecutive quarter ofsolid growth in volumes and in revenues."
The Company also reported GAAP net income of $5.6 million for the secondquarter ended June 30, 2008 and $10.6 million for the first half of 2008compared to GAAP net income of $3.8 million for the second quarter ended June30, 2007 and $5.1 million for the first half of 2007. Diluted earnings pershare, or EPS, for the second quarter of 2008 was $0.32 based on 17.5 millionweighted average common shares outstanding, including the $0.14 impact fromincreased costs associated with non-cash stock-based compensation expense,resulting from the launch of our employee stock purchase program following ourinitial public offering, or IPO. Diluted EPS was $0.60 for the first half ofthe year, including $0.19 of non-cash stock-based compensation expense.
The Company completed its IPO on November 2, 2007. On a pro forma basis,assuming conversion of all outstanding preferred stock, diluted EPS for thethree and six months ended June 30, 2007 would have been $0.30 and $0.40,respectively (see "Pro Forma Net Income Per Share" table below).
Gross profit for the second quarter of 2008 improved 94% to $16.6 millionfrom $8.6 million for the second quarter of 2007, or 59.7% of revenues ascompared to 61.3% of revenues, respectively. Gross margins reflect the impactof additional costs associated with stock-based compensation and theinvestment in additional personnel to support our growing operations. For thefirst half of 2008, gross profits totaled $29.7 million, improving 104% ascompared to $14.6 million for the same period in 2007, with gross profit atapproximately 59.3% of revenues for the first half of 2008 being effectivelyflat year-over-year.
Operating expenses for the second quarter of 2008 increased to$11.4 million from $4.7 million in the second quarter of 2007 and to$20.4 million in the first half of 2008 from $9.3 million during the sameperiod in 2007. These expenses were higher primarily due to investment inadditional personnel to support organizational growth efforts, stock-basedcompensation expense and the increased costs associated with operating as apublic company. Operating income for the second quarter of 2008 was$5.2 million, or 18.6% of revenues, as compared to $3.9 million, or 27.7% ofrevenues, during the same period in 2007. Operating income was $9.3 million,or 18.6% of revenues for the first half of 2008, up from $5.2 million, or21.3% of revenues, for the first half of 2007.
As of June 30, 2008, the Company's cash and cash equivalents andinvestment securities available-for-sale totaled $96.1 million. For the sixmonths ended June 30, 2008, cash generated from operations was $12.9 million,while purchases of capital equipment for the same period totaled $2.6 million.The quarter closed with bad debt expense of 3.0% of total revenues and dayssales outstandin