Then came the SwabRush. Diagnostics suddenly mattered to everyone. Governments, investors, health systems, and consumers all remembered that testing exists — and for a brief moment, diagnostics went from the basement of healthcare economics to the main stage. Public and private capital rushed in. Tools companies, sequencing platforms, liquid biopsy firms, and specialty labs were all swept into the surge. It was exciting, but not always discriminating. For a while, anything with a sample, a sequencer, or a PowerPoint slide about “population health” could get attention, and funding.

“Our team executed extremely well and operated with speed at scale to help our customers and governments around the world respond to the pandemic.”

That set up the GenomicWinter. As rates rose, COVID revenues faded, biotech funding tightened, and the market became allergic to companies without a clear path to profitability, the sector corrected — hard. The science didn’t fail, but expectations had run ahead of business models. Diagnostics companies had to prove they could do more than generate elegant clinical data; they had to show reimbursement, adoption, operating leverage, and discipline. The market stopped rewarding “future standard of care” and started asking, inconveniently, “when do you make money?”

“Our results this quarter fell short of our expectations as we navigated challenges in both the macro environment and with our execution.”

The first real turn came through liquid biopsy. Guardant, Natera, and others helped re-establish investor confidence by showing that large clinical markets could be built around oncology testing, particularly where the value proposition was clear: therapy selection, recurrence monitoring, MRD, and earlier detection. This was the beginning of the LiquidLift. The market started to distinguish between diagnostics as a vague theme and diagnostics as a scalable clinical infrastructure layer.

“We had an excellent start to the year, driving robust volume, revenue and margin growth and achieving cash flow breakeven earlier than expected.”

Now we appear to be entering MarginOmics — specialty diagnostics joins the rebound. The Caris IPO, GeneDx’s turnaround, Natera profitability, Tempus’ IPO, and renewed enthusiasm around MRD and WGS all point to the same underlying message: specialty diagnostics may finally be growing into the business model the field has been promising for years. Not all companies will win, but the category is starting to look investable again because it is becoming more clinical, more reimbursed, more data-rich, and more operationally mature. And more importantly: these companies are now profitable. In 2025, the specialty diagnostics basket outperformed the Magnificent Seven — a sentence that would have been considered satire in 2022.

“We delivered 77% growth on exome and genome revenues in Q3 and have reached the point of profitability…”

That is why the next phase may be ClinOmics — genomics platforms follow. The last thing we need is for sequencing companies to go through a(nother) hype cycle. They need clinical demand. If MRD, CGP, WGS, MCED, transplant, infectious disease, and multi-omics continue moving into routine care, the platforms underneath them should matter again. In other words: diagnostics may be the application layer that finally pulls genomics from “amazing technology” into healthcare infrastructure.

“Clinical made up more than 65 percent of our sequencing consumables revenue in the quarter…”