Adaptive Biotechnologies Corporation (NASDAQ:ADPT) announced Tuesday, April 3, that after a strategic review, the company will operate two businesses — Minimal Residual Disease (MRD) and Immune Medicine (IM) — internally.

The company will also restructure each business with dedicated resources and separate segment reporting. 

Under this structure, Adaptive preserves its strong capital position, which will bridge the MRD business to profitability and support targeted investments in Immune Medicine.

Adaptive Biotechnologies reported the first-quarter fiscal year 2024 preliminary sales of $41 million-$43 million versus the consensus of $38.21 million.

MRD revenue of approximately $31 million – $32 million for the first quarter of 2024, up 47% year-over-year.

Adaptive Biotechnologies announced that Tycho Peterson will depart the company as CFO. 

Kyle Piskel, the company’s Principal Accounting Officer, will succeed Peterson as full-time CFO. Piskel served as the company’s interim CFO from February to June 2022.

William Blair writes that despite investor expectations for separating its two businesses, external factors like the macro environment limit Adaptive’s control over its options. 

Feedback from potential buyers/partners suggests that the MRD business would fetch a higher valuation once it reaches cash flow breakeven in the first half of 2026, while the IM business would gain more value as it validates assets within its programs. 

While under different circumstances, the current execution of both businesses might have led to a higher valuation, Adaptive acknowledges that external factors are beyond its control. 

William Blair analyst says that maintaining both businesses together, with a focused approach on high ROI projects, offers long-term valuation upside. 

The analyst reiterates the Outperform rating on the stock.

Price Action: ADPT shares are down 7.05% at $2.77 on the last check Wednesday.