Berry Genomics Co., Ltd. (SZSE: 000710), once hailed as the "first stock of gene sequencing" in the A-share market, has unveiled another loss-making interim report, with the deficit deepening year on year.
According to the 2026 semi-annual report, the company recorded a net loss attributable to shareholders of approximately RMB 43.95 million in the first half of the year, a wider shortfall compared with the loss of about RMB 27.24 million reported for the same period last year. The company attributed the deterioration to a dual squeeze from increased bad debt provisions on accounts receivable and higher research and development spending. Notably, during the reporting period, the cumulative credit impairment provisions accounted for 57.35% of the company's total profit.
In its interim report released on the evening of August 23, Berry Genomics posted operating revenue of roughly RMB 447 million for the first six months of 2026, a slight 0.15% dip year over year. The net loss attributable to shareholders widened by 61.32% from the prior year's corresponding period. Meanwhile, the company's net cash flow from operating activities also deteriorated, turning negative at approximately RMB 102 million, a sharp 220.54% decline, due to reduced sales collections during the period.
The company explained that its current losses are primarily driven by increased bad debt provisions for accounts receivable and higher R&D expenses. Berry Genomics has been intensifying its investment in research, advancing multiple projects, which led to greater depreciation of R&D equipment and related expenditures, thereby pushing up overall R&D costs. As of the end of June 2026, the company's accounts receivable stood at about RMB 554 million, representing 25.62% of total assets. The aging of these receivables increased during the period, prompting a corresponding rise in impairment provisions calculated under the aging-based approach.
During the first half of 2026, the company accrued approximately RMB 20.75 million in various credit impairment provisions, accounting for 57.35% of total profit. The interim report also revealed that, as of June 30, 2026, the balance receivable from Hunan Jiahui Biotechnology Co., Ltd. and its affiliated Hunan Jiahui Genetic Specialty Hospital (collectively "Hunan Jiahui") was roughly RMB 289 million, representing 23.74% of the company's period-end accounts receivable balance. Given Hunan Jiahui's history of overdue payments, Berry Genomics entered into a preliminary settlement agreement with the counterparty in August 2024 by signing a memorandum of understanding to facilitate repayment. Business cooperation with Hunan Jiahui has further decreased this year, and while a small amount of receivables were collected, the overall recoverability remains uncertain. The company has applied an 80.69% bad debt provision to the Hunan Jiahui receivables at period-end.
On the R&D front, the company's research expenses reached approximately RMB 54.75 million during the reporting period, a 4.25% increase year over year. During the same timeframe, Berry Genomics advanced its "AI + gene technology" integration, upgrading its GENOisi™ intelligent agent into an "integrated maternal-child intelligent diagnostic system." The company also launched a new intelligent agent business segment, although the project is still in the midst of large-scale promotion and deployment. As of the end of the first half of 2026, the value of contracts signed but not yet delivered amounted to RMB 1.90 million.
Zhang Yue, chairman of Aoyou International, commented that high accounts receivable and extended collection cycles are common structural characteristics of the gene testing industry. With downstream clients primarily being public hospitals and third-party medical testing institutions, naturally long payment terms prevail. This, coupled with the slower payment pace from hospitals following the DRG/DIP payment reform, has elevated credit impairment risks and cash flow pressures across the entire sector. For a company experiencing consecutive losses, its weakened ability to withstand risks has magnified the impact of bad debt provisions on current-period profits.
Public information shows that Berry Genomics has been deeply engaged in clinical gene testing for 16 years and was listed on the A-share main board in 2017, earning the title of "first gene sequencing stock." Leveraging its proprietary high-throughput sequencing technology platform and third-generation HiFi sequencing platform, the company is driven by a dual engine of "AI + gene technology," building a comprehensive product ecosystem covering tertiary prevention of birth defects and rare disease diagnosis, and forming a closed-loop business system from screening to diagnosis and from research to clinical application.
Breaking down by product category during the reporting period, revenue from basic research services amounted to approximately RMB 82.07 million, up 0.06% year over year; medical testing services generated about RMB 138 million, down 1.1%; reagent sales contributed roughly RMB 209 million, a 2.09% increase; equipment sales brought in about RMB 14.07 million, down 9.56%; and other revenues totaled approximately RMB 3.42 million, a 36.61% decline.
It is worth noting that Berry Genomics has been mired in losses since 2021. Financial data indicates that from 2021 to 2025, the company's operating revenues were approximately RMB 1.42 billion, RMB 1.37 billion, RMB 1.15 billion, RMB 1.08 billion, and RMB 930 million, respectively, with corresponding net losses attributable to shareholders of roughly RMB 110 million, RMB 249 million, RMB 427 million, RMB 192 million, and RMB 197 million over the same period.