The following discussion of our financial condition and results of operationsshould be read in conjunction with our condensed consolidated financialstatements and the related notes and other financial information included inPart I, Item 1. of this Form 10-Q, and together with our audited consolidatedfinancial statements and the related notes and other information included in ourAnnual Report on Form 10-K for the year ended December 31, 2021. Historicresults are not necessarily indicative of future results.This report contains forwardlooking statements within the meaning of thePrivate Securities Litigation Reform Act of 1995. All statements in this reportother than statements of historical fact, including statements identified bywords such as "believe," "may," "will," "estimate," "continue," "anticipate,""intend," "expect" and similar expressions, are forwardlooking statements.Forwardlooking statements include, but are not limited to, statements about:

our views regarding the future of genetic testing and its role in mainstreammedical practice;

the impact of the COVID-19 pandemic on our business and the actions we havetaken or may take in response thereto;

our mission and strategy for our business, products and technology;

the implementation of our business model and our success entering new markets;

the expected costs and benefits of our recently announced strategicrealignment;

the expected benefits from and our ability to integrate our acquisitions;

our ability to obtain regulatory approvals for our tests;

the rate and degree of market acceptance of our tests and genetic testinggenerally;

our ability to scale our infrastructure and operations in a costeffectivemanner;

our expectations regarding our platform and future offerings;

the timing and results of studies with respect to our tests;

developments and expectations relating to our competitors and our industry;

our competitive strengths;

the degree to which individuals will share genetic information generally, aswell as share any related potential economic opportunities with us;

our commercial plans;

our ability to obtain and maintain adequate reimbursement for our tests;

regulatory, political and other developments in the United States and foreigncountries;

our ability to attract and retain key scientific, sales, engineering ormanagement personnel;

our expectations regarding our ability to obtain and maintain intellectualproperty protection and not infringe on the rights of others;

the effects of litigation or investigations on our business;

our ability to obtain funding for our operations and the growth of ourbusiness;

our future financial performance;

our beliefs regarding our future growth and the drivers of such growth;

our expectations regarding environmental, social and governance matters;

the impact of accounting pronouncements and our critical accounting policies,judgments, estimates and assumptions on our financial results;

our expectations regarding our future revenue, cost of revenue, operatingexpenses and capital expenditures, and our future capital requirements; and

the impact of tax laws on our business.

In this report, all references to "Invitae," "we," "us," "our," or "the Company"mean Invitae Corporation.

Summary of risk factors

We expect to continue incurring significant losses, and we may not successfullyexecute our plan to achieve or sustain profitability.

Our inability to raise additional capital on acceptable terms in the future maylimit our ability to develop and commercialize new tests and expand ouroperations.

The market for patient data software is competitive, and our business will beadversely affected if we are unable to successfully compete.

If we are not able to continue to generate substantial demand of our tests, ourcommercial success will be negatively affected.

Impairment in the value of our goodwill or other intangible assets has and mayin the future have a material adverse effect on our operating results andfinancial condition.

If the FDA regulates the tests we currently offer as LDTs as medical devices,we could incur substantial costs and our business, financial condition andresults of operations could be adversely affected.

Mission and strategy

We were founded on four core principles:

Patients should own and control their own genetic information;

Healthcare professionals are fundamental in ordering and interpreting geneticinformation;

Driving down the price of genetic information will increase its clinical andpersonal utility; and

Genetic information is more valuable when shared.

Our strategy for long-term growth centers on five key drivers of our business,

Business overview

We expect to incur operating losses for the near term as we initiate thestrategic realignment of our operations. If we are unable to achieve theseobjectives and successfully manage our costs, we may not be able to achievepositive operating cash flow in the near term or at all.

Russia and Ukraine Conflict

We expect the COVID-19 pandemic may continue to impact our business. We havereviewed and adjusted, when necessary, for the impact of COVID-19 on ourestimates related to revenue recognition and expected credit losses.

which expands access to remote interaction between patients and clinicians aswell as direct ordering of genetic tests.

Factors affecting our performance

Number of billable units

Number and size of research and commercial partnerships

Success obtaining and maintaining reimbursement

Ability to lower the costs associated with performing our tests

Ability to expand our genetic content and create new pathways to test

Realignment of our business and timing of expenses

Financial overview

Revenue

Cost of revenue

Operating expenses

Research and development

Selling and marketing

General and administrative

Asset impairment

Change in fair value of contingent consideration

Other income, net

Interest expense

Income tax benefit

Critical accounting policies and estimates

Goodwill and indefinite-lived intangibles

Based on this analysis, we recognized a goodwill impairment charge of $2.3billion during the three and six months ended June 30, 2022, which was includedin asset impairments in the condensed consolidated statements

Impairment assessment of long-lived assets

Three Months Ended June 30, 2022 and 2021

Revenue

Cost of revenue

Research and development

Selling and marketing

General and administrative

Asset impairment

Change in fair value of contingent consideration

selection IVD. The prior year adjustments to decrease our contingentconsideration were due to our determination that this milestone will not beachieved in the timeframe prescribed in the acquisition agreement.

Other income, net

The increase in interest expense of $0.6 million for the three months endedJune 30, 2022 compared to the same period in 2021 was due to increased debtoutstanding as compared to the prior year period.

Income tax benefit

Six Months Ended June 30, 2022 and 2021

Cost of revenue

Research and development

Selling and marketing

General and administrative

Asset impairment

Change in fair value of contingent consideration

Other income, net

The increase in interest expense of $6.2 million for the six months endedJune 30, 2022 compared to the same period in 2021 was due to increased debtoutstanding as compared to the prior year period.

Income tax benefit

Liquidity and capital resources

Liquidity and capital expenditures

Since inception, our operations have been financed primarily by fees collectedfrom our customers, net proceeds from sales of our capital stock as well asborrowing from debt facilities and the issuance of convertible senior notes.

At June 30, 2022 and December 31, 2021, we had $736.8 million and $1.1 billion,respectively, of cash, cash equivalents, restricted cash and marketablesecurities.

The following table summarizes our cash flows (in thousands):

Six Months Ended June 30,

Net (decrease) increase in cash, cash equivalents and restrictedcash

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INVITAE CORP 10-Q Management's Discussion and Analysis of Financial Condition and Results of Operations - Insurance News Net

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