Freenome (NASDAQ: FRNM) swings to a quarterly profit on SimpleScreen CRC approval

What happened

Freenome, Inc. (NASDAQ: FRNM) reported GAAP net income of $60.1 million for the third quarter, against a $64.5 million loss a year earlier.

Total revenue was $183.5 million, up from $1.0 million in the third quarter of 2025. Of that, $180.0 million was recognized under Freenome's collaboration and license agreement after the FDA approved SimpleScreen CRC.

SimpleScreen CRC is a blood-based screening test for colorectal cancer. It is for adults 45 and older at average risk. The FDA approved it on July 24. That triggered a $100 million milestone payment under Freenome's exclusive U.S. commercial license agreement with Exact Sciences, which Abbott assumed after acquiring it. Abbott launched the test in the United States on Sept. 30.

Freenome also reported topline results from an updated version of SimpleScreen CRC. It met all primary and secondary endpoints. In October, Freenome launched SimpleScreen Lung, a protein-based laboratory-developed test for adults ages 50 to 80 with a significant smoking history who are not in guideline-recommended screening.

Key numbers

Metric	Latest	Change	Source
Q3 2026 total revenue	$183.5 million	from $1.0 million, +$182.5 million	SEC 8-K, Exhibit 99.1
Q3 2026 GAAP net income (loss)	$60.1 million	from -$64.5 million	SEC 8-K, Exhibit 99.1
Q3 2026 Adjusted EBITDA (non-GAAP)	$117.9 million	from -$56.3 million	SEC 8-K, Exhibit 99.1
Cash, equivalents and marketable securities, Sept. 30, 2026	$430.0 million		SEC 8-K, Exhibit 99.1
2026 total revenue guidance	$192 million to $194 million		SEC 8-K, Exhibit 99.1
Shares outstanding, Sept. 30, 2026 versus Dec. 31, 2025 (67,944,192)	110,870,300	+63.2%	Calculated from SEC 8-K

Read more: Freenome (FRNM) company research

Where the quarter's income came from

Costs rose alongside revenue. Operating costs and expenses were $113.5 million, up $47.2 million from $66.3 million in the third quarter of 2025. Freenome says the rise comes mainly from transaction and stock-based compensation costs tied to the closing of the business combination.

Stock-based compensation expense was $41.9 million, against $2.8 million a year earlier. Adjusted EBITDA, a non-GAAP measure that excludes that expense, was $117.9 million, compared with negative $56.3 million. GAAP net income also absorbed an $11.6 million loss from remeasuring convertible notes.

The nine-month figures are weaker. Freenome recorded a net loss of $72.5 million for the first nine months, against $181.1 million a year earlier. Third-quarter operating cash flow was positive at $38.4 million, and free cash flow was $35.7 million, compared with negative $44.8 million a year earlier.

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The balance sheet after the listing

Freenome went public on the Nasdaq Capital Market on July 21, raising approximately $310 million in gross proceeds. Cash, cash equivalents and marketable securities totaled $430.0 million at Sept. 30.

Two convertible notes turned into stock. About $50.5 million of principal and accrued interest on the Abbott note became about 3.4 million shares at $15.00 per share. The Roche note became about 6.4 million shares at $12.00 when the business combination closed in July.

Total liabilities were $252.2 million at Sept. 30, down from $406.6 million at Dec. 31, 2025. Stockholders' equity rose to $481.3 million from $100.4 million.

By OptimistFi's calculation, shares outstanding rose 63.2%, to 110,870,300 from 67,944,192 at Dec. 31, 2025. That matters for anyone measuring per-share value.

Why it matters

OptimistFi has argued that FRNM is a bet on the quality of the business combination and the funding after it. It is not yet an operating diagnostics company OptimistFi can underwrite. On funding, the quarter helps. The listing raised new money and two notes converted into stock.

On operations, the evidence is thinner. Guidance of $192 million to $194 million for 2026 total revenue sits just above the $190.0 million booked in the first nine months. By OptimistFi's calculation, that implies fourth-quarter revenue of about $2 million to $4 million.

That is the counterargument in numbers. The approval-linked revenue drove the quarter, so the profit may overstate how the business performs without a payment like it. OptimistFi reads the filing as mixed for the case. Funding looks stronger, but an operating record still has to be built.

What's next

Freenome expects the next two single-cancer readouts in December and its first asymptomatic multi-cancer detection readout in mid 2027. Positive results would give the pipeline evidence beyond the approval-driven quarter. Weak ones would leave the case leaning on cash.

Freenome hosts a call on the results at 4:30 p.m. Eastern on Nov. 10. The next quarterly report will show whether fourth-quarter revenue lands inside the range implied by guidance.

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