Burning Rock Q1 revenue falls 19% on slowdown across testing channels

Burning Rock Biotech (NASDAQ:BNR) reported an 18.9% drop in first-quarter revenue for fiscal year 2026, as lower volumes across its core diagnostic testing and pharmaceutical services lines countered ongoing cost-containment measures.

The Guangzhou-based precision oncology provider, which specializes in next-generation sequencing technology, generated total revenues of RMB107.9 million ($15.6 million) for the three-month period ended March 31, 2026, down from RMB 133.1 million in the prior-year period.

Top-line performance contracted across all three primary commercial segments.

Central laboratory revenue fell 15.3% year-over-year to RMB32.3 million, driven primarily by a reduction in test volumes as the company continued its strategic transition toward decentralized in-hospital testing.

Revenue from its direct in-hospital channel declined 8.5% to RMB52.8 million, a contraction management attributed to a one-off issue involving two hospitals, without which segment revenue would have climbed 2%.

Meanwhile, pharma research and development services revenue fell 38.6% to RMB22.8 million, reflecting project timing shifts.

Despite the lower top-line results, Burning Rock maintained a gross margin of 72.3% for the quarter, compared to 73.2% in the first quarter of 2025.

Corporate cost controls and payment collection initiatives helped reduce total operating expenses by 14% to RMB96.9 million.

However, the expense reductions were insufficient to offset the lower revenue contribution, causing the company’s net loss to widen to RMB17.5 million from a net loss of RMB13.5 million in the comparative prior-year period.

Burning Rock closed the first quarter with cash, cash equivalents, and restricted cash balances totaling RMB448.7 million ($65.1 million) as of March 31, 2026, providing operational runway for its diagnostic pipeline.

On the clinical front, the company highlighted several early-2026 scientific milestones, presenting validation data for its oncology testing platforms, including MMcall, CanCatch Surf, and SPIRAL, at the American Association for Cancer Research annual meeting in April.