Twist Bioscience (TWST) 4 Aug 232023 Q3 Earnings call transcript

Welcome to the Twist Bioscience’s Fiscal 2023 Third Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded.

I would now like to turn the conference over to Angela Bitting, SVP of Corporate Affairs and EGS Officer. ahead. go Please

quarter Good which all operator. Twist I like at results XXXX would conference We business Thank our www.twistbioscience.com. available issued you morning, at for thank financial third fiscal our of to this for results joining to and call progress. morning, you, release review everyone. financial is us Bioscience’s website today our

Emily and will you on to will call two others and then, our with call Twist CFO on We as the are Co-Founder then CEO limit come milestones and of to today’s Leproust, Thorburn, that on Twist; re-queue to performance. questions. discuss a me operational of With of report maximum review Emily Twist. your we’ll back and a begin a questions of progress financial open the directions. And our Jim courtesy and Dr. Emily on recent for will ask our call. Jim upcoming businesses. would

As and will website be a the The audio for our in of is portion call Investors section be weeks. reminder, archived available two recorded. will being this

During today’s the securities of within forward-looking presentation, make federal U.S. will statements laws. the meaning we

or future statements generally relate or to future operating performance. Forward-looking financial events

results beliefs actual Our to are results in differ subject not from these financial regarding expectations cause materialize materially and projected. periods that uncertainties to may matters and could actual risks those and

the this and Commission. based statements with release forward-looking any the to hereof, information and issued presentation in fully Securities as well required in These today by forth as to in those update us on press we disclaim described the risks law. those are The forward-looking of available except filings include set date Exchange statements we obligation more any as earlier our as

reported, differently and be between not Relations presented measures When do found on non-GAAP www.twistbioscience.com. that other by at will be measures Investor may a calculated companies. be our reconciliation principles, GAAP earnings EBITDA. accepted financial accounting our with can conform similar discuss which also non-GAAP included in than including adjusted generally Information We’ll data website financial documents

call With Dr. that, Executive Emily turn our I’ll Chief now Officer over and to Leproust. the Co-Founder,

Thank you, Angela, morning, good and everyone.

continued strong $XX third for future business XXXX our orders the million, of highlights with core of quarter fiscal a reported million, a revenue stage particularly of business. for with and management $XX $XX.X of our setting the exceeding The to million We quarter of $XX.X record guidance growth. million,

this as we vast out site. SynBio production shifted April for driven shipped And at manufacturing today in the we’re record celebrating we the of majority business products the of new of part Beginning this line. Future Xst, Factory from significant revenue

investment back, in signed in a space set we build million site, step We and a SynBio which Taking made fragments. height pandemic. to XXXX, a the lease of $XXX the the instrumentally agreement growth of specifically genes out would clonal gene knew the next be we our product XX-year line, December for in for

pandemic and and plan budget, chain lay for amid the our pressures. execute successful ground on our ability the growth. significant completed future on macroeconomic Factory team operation of of of and the Future projects team Our even distributions manufacturing the and global site work our and time The difficult to completion supply challenges, second on demonstrate of the the

Future these of number were out that of the XXX,XXX shipped started about Francisco will in South By to period, genes Factory genes the and had in we pressure out of We less than this that of before comparison, we Wilsonville began San production XX,XXX same point testing shipped expand. quarter, April. genes the continue and

for genes and to XX In clonal resonates time X and to turnaround XX with days continue customer of customers. our expand days take we business share. base business, for our fragments consistent market SynBio, gene X core the to For our

In review feature, differentiating time every fast but to we today as the turnaround past, see customer scale, almost primary addition highlights our was a price in key benefit.

of We we to fast in gene introduction will towards drive move the continue the fall timeframe. planned speed as

the four key on in and launch fall, the we’re today Between working activities.

of releasing First, genes minimize internal the manufacturing idle that that the then software. execution software the are module implementation of time the to system and testing

Second, be reduce refining to the time we molecular where processing safely processes can done.

able dynamic associates, And to Third, a adjusted e-commerce pricing. fourth, streamlined to process. retraining transact the the we production so platform hiring of with new our cadence manufacture be

we launch on are a in marketing the future to working addition, robust side prepare In and customers. target current

will be believe for efficiencies improving time and genes disruptive that there note gain to also this fragments. I’d when launch, to product, in believe we our turnaround we and a like the further be still we will future,

Factory producing SynBio vast Future all the results panels, our the Francisco to of the majority delivering While South our San quarter. site is of the NGS excellent products, of manufacture our for continues

We customers. to positive from continue receive feedback

the enrichment reducing cost, COGS In them of macroeconomic XX% resonates. target that saves proposition that downstream highlight our this Some approximately chemistry customer value environment, overall. using sequencing

to continue competitors. our in We against bring trials head-to-head pilots

several for were last In the to biopsy field points pleased see positive quarter. addition, proof the liquid we over

in the are in early of as test detecting as our cancer customers We guiding to important this commercial the continue demonstrate will we believe treatment to success their well and tied field, decisions. substantially and value recurrences

and quarter, the seq portfolio, the very feedback we launched during opportunity market positive. robust is RNA our Expanding initial a

the trialing customer many products and have have received initial We orders.

immediate takes the opens we Across product excited launch. to As grow four we workflows, believe today up revenue are introduced this one RNA about it but with growth. products, Products not markets years. this we to next the drive particularly our over research time portfolio produce revenue do

the the we business of to growth that introduction we continue have good needs, business very that continues results expect carved we within core products trajectory, Overall, its will we delivered out for this have core meet and and on innovative industry a radiate extend the again serve. niche the Through markets quarter.

have We lower the our the numbers should in remind and integration that to were orders below those Revenue in expectations. both for and we internal quarter. experiencing Turning Biopharma. resulted issues came challenges,

Our integration internal lagging challenges. sales open our for headwinds, that see we headcount deal-timing, today indicators team which or and those underscore the include

impact from We and the world, though see take top have to the strong deal impacting in These throughout the foster some also interest seen time biotech funding APAC from particularly relationships we environment, particularly quarter. and pharma restricted companies close, market EMEA. timing, for

we In a headcount key has that than commercial for which we we open open know addition, positive we anticipated. business we have secure longer development managers, deals. where Biopharma talent, On been have side,

We take and onboard time are roughly team It sales does to to ramp current ten. our looking to double five Biopharma from from up.

game. but the immediate long fix we play revenue, So, this is an not for

and to operational services, offering, continue Twist progress the increase. the vivo, in which Biopharma robust success We silico interest processes newly see our in in internal continue on launched that make up discovery deals believe as approaches, combines particularly vitro, to for will we us Gold we in set Standard

offering service our around Biopharma monetization, we our programs have and from we’re efforts Moving in to all asset discussions focused our five fronts. internal and prioritized

will and to value the expect previous the creations year, to cover of over short, guidance continue our medium reiterate long and we business want we analyze next, As fall but will to manage for that to evaluate, ensure short Jim I the term. Biopharma for

workflow the gigabyte demonstrate Century For of end-to-end Archive calendar data end we storage, an by expect XXXX. to

Century Following solution. Aircraft on a XXXX, expect in calendar this, we launch terabyte to

corporate Moving development. to

to manufacturing the beyond We accelerate our months are our in shift profitability resizing the action path substantive now to through and three Company.

full While fiscal quarter the XXXX, not is the be will changes. first realized cost adapted the the savings of until to organization

Accounting technical the a also the expertise our May, accounting to With and range as Officer, across have Chief Chief solution we the of us global ensure Werner that a Rob in as as of analytics. Gandhi June as bringing positions. wanted our reductions expertise we late areas, we ability including joined experience. in Officer in accounting architecture on well business, have hire Information bringing joined data Chet key late wealth application made to us

are looking forward transition our phase We next growth. our accelerate both into executives who will skilled to of profitable the

it turn Jim. over I’ll to that, With

right. Thanks, Emily. All

customers a three million, was of year-over-year quarter number difficult and for with is record $XX.X macroeconomic truly Revenue which quarter approximately We despite of outstanding increase sequential a had more environment. a a of XX% served growth were guidance sequentially the X%. approximately million. the for ahead of by quarter to million and X% million Orders an year-over-year was X% declined for of margin our and of increase Gross $XX quarter, $XX XX.X%. $XX.X

the approximately achieved Our to customer cash continues and this of to shipped the transitioned X,XXX investments compared base quarter as quarter to three the to growth execute And we we with of major this we’re third Future, and We organization’s X,XXX in customers a ‘XX. proud when $XXX and of we grow, to million. of ability fiscal Factory concluded in quarter truly the transition.

NGS. to Now turning

year-over-year XX% growth. for sequential record revenue $XX.X a NGS XX% quarter Our representing and million, was three

Our $XX.X a XX%. third quarter orders increase were sequential million, of

XX% approximately period customers XXX the fiscal growth revenue $XX NGS the top over for XX% grew approximately NGS year-to-date revenue orders about approximately served quarter Our with and accounting in to same customers NGS of for three. our in fiscal we the million, XX ‘XX

quarter. XXX XXX scale, earnings as tracking continues last call, our for to in larger compared and opportunities now XXX up accounts, pipeline we’re noted Our XXX to from Twist have last adopted

where period annual $XX.X market DNA year-over-year their let continue that’s includes with XX% $XX quarter XX%. take representing quarter for $XX.X the approximately to $XX they fiscal SynBio and blanket purchase sequential the million same in up grown set which to is increase in $XX SynBio, rose and year-to-date as ‘XX, place to million, new of approximately million, X% IgG, another me of sequential genes, pools. and up to million, customers in as from decline and which preps, Revenue turn the from growth budgets. is libraries SynBio record, trends a share. million growth Now have orders Orders oligo we consistent March orders were

includes quarter ‘XX. note, we pharma biotech has as companies SynBio well QX, approximately customers, for fiscal as academia. shipped approximately X,XXX which the customer base third grown and of our In X,XXX to large SynBio in from Of

of Our year-over-year as growth of which approximately compared third genes $XX.X $XX.X ‘XX, revenue the increased in quarter fiscal million to to XX%. is million

Factory we and operations X% in Future production quarter execution. to for fiscal XXX,XXX this a three, team As highlighted, approximately recognize genes our and to of quarter transitioned gene year-over-year, we want approximately the an terrific the our shipped increase of we

continues and business do pools oligo well. library Our to

sequentially described quarter from This $X.X of for in number declined is reflected down million. challenges And Biopharma. Emily Biopharma third the $X.X which due $X million active Orders ‘XX now from decline XX. in from sequentially the to $X.X moving revenue XX of was million, also second were programs, for to primarily has to down quarter million, the quarter. fiscal the

actively addressing short-term We’re the and team. challenges commercial these rebuilding are

chemical ‘XX Industrial million fiscal third by of compared was million $XX of the cover million compared fiscal ‘XX fiscal $XX.X quarter fiscal compared in revenue revenue academic period now the our quarter to third million $XX.X quarter of revenue as was Healthcare industry. was the in breakdown $XX.X in third ‘XX in to million fiscal $X.X of as I’ll quarter And ‘XX. $XX.X fiscal of ‘XX. revenue third same ‘XX. the period the for to same of the million in

fiscal $XX.X Moving regional progress rose million to versus in ‘XX fiscal fiscal our $XX.X QX ‘XX. million to EMEA in QX QX revenue for ‘XX.

million in for fiscal increased ‘XX. to period the to For $X.X the of period million increased third the $XX ‘XX. same of for same versus APAC, quarter U.S. to revenue $XX.X And million million overall revenue $X.X compared

And moving down the P&L.

initial our quarter fixed gross in reflects May. XX.X% was in for which of as COGS quarter compared a leveraging reduction the two, Our to XX.X% revenue sequential our cost and announced early margin growth, impact three

revenue San Factory first third transition the benefit to from continue we $XX.X the in of Francisco $XX.X million of fiscal the ‘XX. cost quarter quarter. management the the compared as expect our million see as to current the to full of And for was cost operations some our previous the in Our Future, of to we of quarter in quarter,

period break quarter operating quarter, for change fiscal same was for $XX.X was $XX.X as including from To the the fiscal R&D Revelar million fair Revelar due costs million spending million decline as R&D, and the in down, ‘XX. it expenses quarter three Our primarily as in million, a deconsolidated fiscal in XXXX. $XX.X approximately to ‘XX, September of value, XX, decrease restructuring to a of fiscal mark-to-market $XX.X SG&A, in was compared

million $X in a well a of million. spend in activities compensation decrease stock-based $X.X reduction of fiscal of third Excluding reduction D&A, $X spend million million and to stock-based as decrease of in SG&A the does by include storage in was R&D ‘XX. to R&D impact expense. Revelar, as $XX.X the in This as decline is comp was Biopharma $X.X in QX QX R&D the $XX.X of quarter driven compared due million approximately FYXX. of primarily million cost

of costs with of including by are the be a will Future approximately phase, associated in the anticipate $X.X and million operational that year. of number pre-commercialization they SG&A were we pre-commercialization Factory end fiscal labs

Restructuring million, including costs for were approximately for quarter employee $X the severance. $XX million

for of In the to addition, $X noncash the million Future. we leasehold from SynBio transition San of assets incurred our with of and the Factory approximately impairments restructuring Francisco associated activities costs

Stock-based million. investments in $X months spend three million, the for and quarter from million first approximately Future, amortization million. compensation the $XX.X Depreciation $X.X an of our quarter for million to the for fiscal approximately in third the the total was nine which previous Factory CapEx of was was quarter. CapEx associated year of quarter increase the $XX with brings commercialization $X.X the cash

I our outlook will now year. the for cover

well. launch performance, of are Factory NGS of we’re business. our a the We SynBio the and going with had of and Biopharma highlighted, we’ve doing our businesses antibody addressing the the strong challenges is quarter Future As well, operational

FYXX. For

revenue end year-to-date the Our quarter of million. of approximately was $XXX as third the

increasing and $XX our million to million to $XX million. to the million, that’s the fourth million and $XX previous range, ‘XX million, increasing from revenue $XXX quarter, of our For to $XXX from million million in up guidance up to of guidance the and range guidance to $XXX the $XXX $XX that’s therefore, fiscal year we’re

$XX of projecting top to end our million. For million FYXX, previous range we guidance are $XX approximately of at of $XX SynBio the revenue million

previous be which an million, is projecting approximately orders our stronger $XXX range $XXX million we NGS FYXX $XXX for to increase from in to and are earlier. guidance revenue discussed reflects million We

downward million, reflecting from previous expect $XX a We to revision Biopharma million of million, that’s revenue our $XX of Biopharma $XX comments and challenges.

margin, XX% these to San with projecting For Francisco out XX%, costs, XX% gross X% migrating approximately for margin associated fourth the we’re projecting to includes Normalizing are costs that which we from are QX, we Portland. operations quarter. in a increase

for expense side, of of development the approximately expense million. and SG&A we’re quarter, restructure expense and the projecting million $XX $XX research On million, of approximately expense $X approximately

margin, full expect gross For for XX% fiscal fiscal for approximately we ‘XX, ‘XX.

for the to as previous guidance million $XXX to approximately of expense is the operating million million. compared guidance year $XXX Our $XXX

projecting to now of previous We’re expense million million million $XXX as compared to our R&D guidance. $XXX approximately $XXX in

previous noncash. $XXX of $XXX Onetime to guidance $XXX due be million projected as to compared including approximately of $X credit to million Mark-to-market million, $XX primarily income both SG&A million. to expect We expense and the be is compensation. projected a is impact stock-based for restructuring $XX to the of severance of lower Other million, the and million. costs of year

million be our unchanged amortization million. projection our is that’s stock-based $XX and for from $XX and projected declined And from million, Depreciation to previous to $XX guidance. compensation approximately

‘XX, with we data storage, $XX expense we fiscal guidance. approximately DNA to that’s our and for also expense for $XX And storage. for operating million Operating expect be consistent million, expect previous

onetime year be approximately projected cash projected million is previous year the $XXX is that’s is million from $XX of compared to the $XXX decrease for be million, approximately a charges be million CapEx to for million, approximately and $XX $XX And restructuring. loss previously. for ending operating of projected million. Net $XXX to guidance to inclusive of

have our $XX Before due million we million in concluding, the the to savings including we $XX of be We in guidance million, briefly to the announced from into overall of And these the May. provided. estimate of approximately want SynBio Future $XX restructuring transition to activities to built and impact I annual Factory R&D. the savings recap approximately we operations operations

commercially the the we’re summary, Future. shipping of from Factory In

agile We fiscal we of are the breakeven EBITDA scale. business exiting the our managing quarter adjusted EBITDA customer cost business at share, define market for focused EBITDA Biopharma continue fourth compensation. as so our to areas as manage stock-based on adjusted core with gain base for excluding actively. we no delay, We adjusted anticipate structure to continue ‘XX and breakeven and EBITDA all We

As Twist, our CFO to have these say you years concurrent I that read five want I my am lay excited operating remarks the forward facilitate opportunities X-K today, new semiconductor a at I’m of background with filed earnings. finish I after and as that apply of to And sure many in my phase I contribute growth. that our continuing to for Twist ahead to a way big next our success. look and to am in to believer

that, with Emily. And I’ll turn call to back the

you, Thank Jim.

pleased spent will integral date and in provide As revenue advance over efforts all five role, CFO get many semiconductor thank today, per having well continue as fiscal scaling million for other leverage financial joined reported I Jim his been quarter, am in the of of activity data forward $X to to third years areas million his approximately and to look has like to you we he know, development guidance revenue storage. Having $XX quarter. and we of business. personally where that our his us commercial when the to background us using for was to I’d the strategic last operational contributions for Jim done has as the our as to Jim are

We into as Jim for CFO conduct soon new And this will field, a as search will position. role. transition the the is

core the opportunity and growth is with profitable scalable closing, business ahead. growth for reaping In

the progress be the which this good of fall available launch of genes, fast made have customers towards We will year. in to

for return This delivering we in that own buying this market more billion need charge be faster than large today. any price. important and can a premium it believe $X.X it DNA up they DNA fast from researchers it their growth a make companies scientists is delivered as cost In make currently will we instead effectively source of virtually pharmaceutical we made genes, and For of the academia makers driver, They are market. and targeting DNA.

software workflow clonal fast bottom efficiencies, with able genes from same we operational current the and genes price through and the line. COGS dropping to fragments of our power genes our fast gene standard make the incremental all as to will speed be directly at Optimizing

We gradual and of tail build as it makers. expect in quarter to be and long we our for fiscal seeing to XXXX, the DNA of digital the fast first a the genes tools reach will be infrastructure leverage revenue marketing

robust research continue be that today workflows footprint smaller growth believe will opportunity have RNA more we NGS, For where the included significantly and we workflow grow expand. a and We in for more we future. the our and believe we to of area NGS launched our foreseeable for assays, a sustainable scientists, can an be

do we Biopharma, to the around. have work In to turn business

interest the offerings, services both have We to we commercial and our and team. working scale for in are out-licensing our opportunities, the

working we’re gigabyte the Archive data calendar storage, towards solution customers an XXXX. data early Century For release key delivering and in end-to-end storage with subsequently, workflow terabyte to

And for questions. with open the up call that, let’s

Thank Instructions] Evercore you. question Kumar Our ISI. come [Operator from first will with Vijay

having As fiscal trajectory And of Emily on a here. Jim, across you an first were NGS Biopharma Biopharma exiting for on Congrats a you’re those maybe look you It the conversations sequentially my is markets? talk dollar or diagnostic ‘XX? When end maybe gross here customer SynBio, execution down at single we orders, orders orders, you’re of sort how good conversations down. thinking down, progressing? fiscal on basis. should revenues about here, indication in be margin like for those can XQ, high question that given slowed looks how

for Thanks Vijay, the it’s Jim. question.

your look to is back the point that Orders of business, sequentially. last saw previous and March And on orders, year a correct. June in the the did year, at we If quarter. you saw decline SynBio, from pattern decline stand and terms

with a secured progress we’re year reasons pharma. we of the year. allocated customers budgets large with And purchase their a One us their for the give indication the and as an terms couple have of penetrating what business they that. number orders there’s blanket for of to of us is making see So, in for

we percent. same last step quarter-to-date at year, our you situation if roughly think orders versus are you and look you XX-odd look we’re I about at growth up where back and

market strong a growth. continuing we’re of is seeing are And We Future the to Factory gain share. customer well. The going

end launch of in the see of original growth So, the to with NGS. as fast is year, year line about next NGS in We we look forward going which million, we is at November issued genes. see $XXX projections of last for the the that we this year. the terms be

-- great Biopharma, we we’re I So guess, really overall, issue have integrated Emily business got is in a reaping. business a as addressing. the short-term We’ve highlighted, which offering. is

genes, So and overall, I business. feel gain I we good the we’re feel to continue about fast good positioned share. with

how see fiscal year. million ‘XX stepping I OpEx And did you It growth your by projector $XXX margin about think burn slide down your for think, versus cash When the like million, Some ‘XX? step-down $XXX being gross on ‘XX, that’s for be fiscal looks this it’s Understood. in burn, about cash comments, coming much qualitative revenue is improvements down I on assumptions, helpful. of a $XXX will had for next assumptions driven you close fiscal versus to million, Jim.

Yes.

look got I this a million. in managing of R&D as So, exiting mean, in we the at that down. our we’re year, One we’re you brought anticipating and of terms R&D for you of year $XXX of combination the SG&A, areas. Originally, terms is three numbers costs.

that. now significantly managing. below down We’re we’re SG&A,

that’s about actions $XX overall million We in a of we us May going estimate terms this year. save cost, to In announced year.

structure got year, we to key my As role go And focus. transitioning of as this new million this I’m we’ve in to forward. about manage $XXX we exit terms our why next cash cost we’re our is going year, is

We’re adjusted growth, about going going we in to plan. of feel the and the business good about that to QX core and top feel for year. to opportunities line good executing get And to breakeven drive next we’re EBITDA

dollar on basis the ‘XX? OpEx Is next will that seeing year be fiscal assumption? you down Jim, versus are a

and we we’re structure. is be as going to the going leveraging go assumption What our be to we’re OpEx cost managing forward,

the revenue to next the our year, going goal quarter terms of adjusted gross and core -- $XXX for million at at increase revenue next we’re margin, the year. four we by breakeven So, our as going annualized of in get to business to the we’re EBITDA is improvement see

So essentially, look you take takeaway cost the QX is our structure. a at can

manage breakeven. number a roughly to to us going that adjusted to We’re EBITDA that gets

we’re managing DNA as which For this the next OpEx the million storage going to is storage, DNA year. to $XX be year, same

We Goldman Sachs. Matt have from question a with Sykes

took Maybe restructuring referenced quarter. EBITDA on think for sequential you Biopharma And last next just know the actions first, Jim some in you some Emily, the guide the slowdown business. breakeven out I orders. year. I pushed

lot you next how business from looking But that thinking over business? a or the Just are in cyclical with commit a two? are dealing And the you know of terms about we’re position that I of competitive standpoint, pressures. you today? a feeling to structural standpoint, from are year investment business what how to of

Matt. you, Thank Yes.

you serve service record in we as segment. industry it’s that two Biopharma SynBio fine. we products, Biopharma that record we sell the Solutions. So, in we going sell we in then side And our products ways. One, in SynBio sell know, we the and And

it’s that is going well. market the of view all our So,

to It’s we a and we Biopharma at talent. surprise commercial in in talent particular territories, a is our competitive when of our extremely competition, in when we have point we vivo, a competitive around if And a the vitro, analyze commercial offering, your silico very solution in combination in because business. have win have particular have And so, look we issue not services. territory, we

to talent And our territories. have right Solutions not now enough so, issue commercial cover we do is that all in that the Biopharma have we execution

expect the hire the will am five for in sure most all most we on that We important talent currently. the And replicate the focusing thing is way I’m grow that quite me, confident I have we what’s that territories. the one happening business if can the the we in And successful territories, it. making

for we of looking of mentioned, do going So, to event of and then milestones managing so. are business continue which training we’ll turn as around. to actively in the talent, is we’re I’m That’s orders, them, first And it hiring revenue. getting sequence the terms getting in the then Jim

Just just in what Jim, firm, transition, of now? thoughts transition. Emily then -- talk terms for on and internal kind follow-up, your And thoughts are possibilities? And why Why for Great. but terms want timing. there just on a for your are you to know Thanks my the sense of that. on for a kind in exploring about on today? all search -- timing, the of Maybe externally, hired of I versus just And replacement? Jim, get just

Yes.

shape. In the terms in the Future. the last good well. up over business going a timing, challenge mean, was key I issue, is year That’s of of bringing Factory

We’re And of interest. seeing breakeven sight adjusted get of to a lot year. QX to have line EBITDA next we

terms business good So, line of from timing an point you commercial maybe and of overall sight. answer is the the view can that rest in of question. of Emily, And the

yes. Yes,

yet, at search, terms point in would recruit would be think anybody external. but to I external just process. be where it an of the this it we’re starting the I talked haven’t

from Puneet Leerink Partners. Souda come question next will from Our

good role. here. had look, -- Emily, cuts first a on and couple of say, bit I -- if all, you I could about So business would first in one mean, little meaningful Jim, new questions. Biopharma. luck A step of the you this about talk back on

replatforming. You’re

reaching not XXXX in that are as you expected. You business in breakeven

The discovery You’re of benefit rationalizing out trials guide peers Biopharma from CDMO lowering ongoing calling again. your out that’s are there.

a at appears high share it So, that level you’re as losing well.

So, But to the term? business the understand and growth Company, how the in strategy side. does trying of just overall, into look You’re run? and customers NGS in research Biopharma business well this Twist on side into outlook doing overall when the for the profile you serving longer core growth the longer how fits at the fit wondering the obviously and picture

the for question. No, Yes. thanks

preclinical those development. EDCs, of stop selling are reminder, discovery some a And fragments, engineering, drug also services, in discovery, we so to But pipeline, optimization, of we customers, Biopharma oligo discovery those but to customers stage. services, discovery the sell development at -- for are some pools typically, drug SynBio as our side, so actually, the the So, the stage when the our cell optimization. on are our services genes, selling we we same TCR, so for bispecific some some what early antibodies, HS, we sell our

if Twist using biotech, work the of biotech, more antibodies the and we’re going and full so, SynBio, gene for message our sell the the our be customer, yourself the to to small That you’re pharma having large that your when get And And do product fragments, to a both pharma, the from able going efforts sell front to you’re that we effective, resonates in by is IgGs to menu, and well. productive more drugs, of working. customers. in benefit able is service we’re gene,

then what the a have at targets the your not you and way, target And if for are therapy many not you internally, too those we -- to then we’ll to outsource Biopharma those is service able are own and you’re discover targets into go of for and time the on the or to same us, you saying you find a which a all if by antibodies prosecute able have business. as service

synergistic. are side. customer. products And is same so, now, both SynBio having and it’s benefiting services serving more And Right menu of we the the

positive. two commercial optimistic quite some together, have Biopharma as As And commercial But territories see the works. we the where service. execution as we I’m the on some adding we it it territories see have a I I net mentioned, issues in talent, again,

optimistic So, again. if it the monitor do it once, future. activity, the but we of for we’ll courses, are works quite And

year-end? expect remind just the you Wilsonville, a writers do Can Okay. what have just in by you be number us one currently and to how brief many Good. that you operational on writers. Then

operational. in So four as Wilsonville, space this right have San we order. Wilsonville. have all In don’t have South in point, At we additional on XX now, writers Francisco four we for writers. well writers writers as a They’re

going X needs. the for foreseeable So serve X our plus are future, to those

from Barclays. question a have We Luke with Sergott

on growth can across that remind the in space, economics some give of just think guys the And sample? directionality about us you or do On the achieve the can biopsy here -- -- the if are you so when should start how as on seeing quickly about liquid MRD we you per think how type us the MRD. partnerships, guys that you you But tell ramps to that side? NGS us on

want or want take Jim, to it? that, to me you You take

it, You can Emily. take

question. Thank you, the Luke, for

in they as as into customers So validated are And and know, they as reminder, win they commercial, we into their as so production is our go from MRD assays. reagents we get time we pilots, analyze you tied those biopsy in as liquid way And baked their get see -- they a it the I a reagents patient, and success. the commercial every Twist. as some use use

their And participate so, as ramp. a of function revenue we

get, In XX% amount COGS we the of typically, think around fair try their value. dollar that we to a is that terms of

also depends it the they we more. the extent Sometimes on from us. chemistry And of use get

the Some customers, for only use they capture. the DNA

cases, to full And able we we so we how sell that’s chemistry, sequencer. our win to we’re many in solution, reagents the sample then from based other quality the the of of the extend the and sometimes win from And to -- DNA. on components all the the

the So the COGS expand point, the adapter, [ph] beads, percent at we the that that of everything. to commend. barcodes, enzyme, we’re buffer, able the the can the And

pools? which there, is the genes, seeing for now? coming coming initial guys are a as the interest quarter? initial Is more when Factory Future are to getting as expect can Like, on orders there? and you are that products guys you And starts taking next interest you then, most demand we interest then you of And guys online of the right the start how the online, --

speed we are now, the fast Right really what be at also launch expectation a the are fall fragments fragments. Fragments, the which ship many as that well. we have of my case, genes driver going great doing should well, course. we And really all is, libraries in also well. can and Well, some are libraries started accelerate -- segments going as in to

to is the they frictionless, time the invoice, is to say, the that it right free, often we from So, people touch, get that And the the depending the from they Twist. for there key pay time they something the everybody for is beautiful And say customers I’ll And that And experience. the a of website testament like. quality experience priced the how the that on intuitive of user is the element I DNA our product, they and is on often missed get very user that’s experience. success. to get are.

for just fast one. you the the Are orders fast quarter on quick genes? genes, starting next to And guys take a

only it’s You’re getting me because launched, soon as will... in we trouble it’s two as -- questions

Cowen. It our Mah for moment question. TD next comes from Steven One with

Thanks for the questions.

follow-up the business. Biopharma a Just question on

those where guys the dropped. your sense programs board to you weakness seeing was Biopharma program of Are the active think of across of trying number partners? I have Just most get a partners, said they mostly loss we’re that from the -- from are dropped programs emerging in the your or business? biotech

done. clarify we should we we maybe are that a finish So, as program,

from the drop programs, and active so, paid within And it list get then we of we the invoices.

our more the fact than right programs started, program and finished that decelerating. so, a active the of we is And orders that now we dropped reflection that means

And those because talent, But focused win commercial on where as so, talent we we’re have will revenues decelerate we I deals. orders. the highly following mentioned, hiring

the I then you more push a that have more you and new economics? your partnership adds? program fully upfront is resourced. and that clarification. new maybe seen impacting for the appreciate like on haven’t for calculus yes, Thanks back-end less Okay. you’re front, partnerships Yes, not partners And and -- on with been But

of great subsidizing That’s principle, the guiding our a question. as Yes. not are we customers. a -- research We

the to And focused so, margin. But highly And for the a provide. on can is that work upfront are benefit. fee sure service we royalties, payment we exchange making for we talent we great pay our always value fair good that’s the a if get for or want milestones to that with with have

So, I’m fee. not hearing on a of upfront that pressure

we in commercial the the fee tenant, be what customers to much perceive very of are I I with provide. our value is that articulate for line value able think able the think we we to the service bring, have once

comes with question Baird. next Schulte from Catherine Our

back to going first, guess, I fast genes.

I quarter first think you of those seeing you revenue said ‘XX. talked from the about in fiscal

be conversations what time? kind do based willing think your turnaround you pay premium faster Just with of to customers, for a they’ll on

great Yes. question. a It’s Thank you, Catherine.

is industrial going they’ll to to -- compared we So, value the different customers. be passive have for academic definitely seen what is of customers the faster gene

dynamic do be, would for we because the more the for maximizes which willing to the to that just we get And pricing, extract. that I will price we there’ll then be so the can gross be pay faster set in and call price up discovery enable Twist’s actually, genes. going us for with as to is have what different margin terms price optimal to able volume those time there premium those industry, first to customers history, industry in academia for a is be probably, that of think, what And

not on So, yet, we mechanics place going in that quite is what do us. in not table we’ve markets. That’s it to to the are willing commercial put guide pricing to the sure to those we able leave money but be the dynamic make bring

then, you for quarter. in gross step-up margin in had margin confident a XX% And gross you this nice fiscal ‘XX? Are still

So good gross question of of That reductions. initial cost in reflects things. in the a One is terms step-up margin. of impact couple

structure Second is as you growth. we a leverage our sequential as cost saw revenue

terms breakeven. terms it’s terms fiscal -- in of EBITDA of get question genes. reach to a pricing, margins. we And Factory of we fast be fast mean, launching. the focused genes our going are mean outlook would adjust to premium get for of I’m about as It excited I And ‘XX, In Future on of getting the premium I good we capability demonstrates that’s pricing. particularly in the

Francisco based at range as Future. Our we XX% mean, potential Factory And both focus, mean, the margins to and of I long-term $XXX on targeting of our the capacity revenue XX%. in gross million, over approach we’re annualized San of I the $XXX million

And question come with Vatnsdal our next will Morgan. JP Rachel from

up China. today. on me from one Just wanted to and APAC I follow

it down had quarter, updates this flagged across quarter. there heard but were concerning out of We’ve the you that see region, industry in China. last then stepped looks rebound guys sequentially to So the starting you some a like revenue

I So, you in this China did walk really what you are how then APAC? us orders wondering and was And you. trend just broader seeing could if through quarter? those Thank

Yes.

question. issues X.X. We March in in year-over-year, our China, in saw terms Overall, step did quarter. in terms the December we’re about good approximately In down to demand. in Clearly, are last -- year a We revenue went revenue from China our to saw APAC. September of million growing to down there $X of million. $X quarter quarter in So, revenue pickup

we’re million and roughly However, value that’s overall, seen the million about estimated emerging. is our the shipping products other we’re pickup That’s with we this We in last $X seeing year. had from we’re some for $X this by we targeting below pools, slightly and also what I QX, major and NGS our opportunities in which driven overall. opportunities, had coming year, we portfolio. year, China and of flat mean, China, oligo are predicting but seeing have anticipated

are June from a great So, a revenue sequential we and decline, have quarter. there, And a we’ve other great facility flat sales got although to is people team. March seeing quarter approximately

question William next Larew Our Blair. will come with from Matt

the Luke’s The ready activities those you through a that in QX, are launch. would potential should to here you’re fast four to progress maybe for preparation and play a be launch that gene and fourth confidence we or launch. Emily, stack given upside around in rank launch, fall first according walked for ramp question get to in level September the Maybe to about items key you I XXrd? follow-up just And think targeting? quarter which think to here key starts contribution search factors Google on progress my expect as

it you. on what first for. that if Thank we and not that’s there Great be days, is contribution day in question. looking September, of launch we Even but it the fall some could are ships five possible in

start think the will QX. contribution main in I

want is have that the we the the the we effort still long do to in pole that the be tent. of e-commerce not continue. What team terms stack to told we’ve In

the that. to ready the so the gets lab work And is sooner, in before going to e-commerce be that extent done the

timing in we the we launched We’ve happens what done. the strengths purely of of products. be DNA. drive That’s it’s many, so of needs to the -- one And many a lab that of have launch. And what is the different have Twist good sense products of levels will many

e-commerce. and We lab, by things are by on are it will actions in track, not the the going very be optimistic driven with

you in sort RNA genes product. portfolio fast launched obviously, new the Okay. next of an launched May, Then, But IgG. you last and May,

you be with seeing you’re feedback opportunities traction curious IgG just seeing may portfolio? perhaps and So, what initial with of RNA this kind or the that

Yes.

been has portfolio RNA from feedback initial positive. the So

test. the launch, seeing back is Stepping then to reorder orders IgG and it’s The average. for We people been product IgG And are to highly differentiated. frankly, will we for there, quite ramp. from expect not

the so, from is the fast gene greatly be ramp. to And differentiation expect influencing we that going

As more run. are, you you know, you the differentiated faster the

And as make So, will run benefit to fast, IgG. we that we genes fast think faster. able gene to be we’ll bring

And being only products genes but genes. that think of the differentiation our we fast of to not that get benefit other are derived able could from also improve so having double we a

accelerate our so, IgG And are speed. also going in to

And our last Sung-Ji question will come with from Nam Scotiabank.

on on the chapter. the to Jim next quarter and Congrats

the looks sequencing maybe congratulations the landscape current I market on is kind relative portfolio, on you question kind talk launching the had So, on that. there and sequencing of RNA the DNA potential about like? to Could the market of -- a competitive what what

Yes. Great question.

the different probably think we market customers. size, So is the very as about similar

a On to clinical the that are samples DNA using diagnostic targeting report. analyze our are and DNA side, companies provide we

we after academic customers. mostly the RNA, going are On

seq go hands-on time, now, from on it’s RNA faster seq faster academic could go is with the so much less sequence you that can with But sample workflow, to significantly The right over think Although time. clinic. we targeting. into mostly differentiation are that I one bring product RNA we a our

very so, And it useful. is if automated setup, academia, and really In matter matters on is it in that academia maybe but where or in a setting less, key. an doesn’t time it’s

and with tRNAs our of also enable of significantly the housekeeping sequence number that we’re to like that on. able reduce the interesting, customers is space on are part and genes we then not Exome, And so freeze wasted RNA to RNA

per the per cost so with And sample. cost And it therefore, the lowers strong a academia lower resonance sample. that’s to again,

in two And differentiation. XX, a with number are to to I discussion, in probably market going we guess, came us we that’s the market. And those we’re in differentiations. enable are very share. think like [ph] some seq, the late So true But I entrant RNA take in

the for you thank then And helpful. super all market. That’s end color Great. on Biopharma the

funding MRD of Just your stability that and for for seeing from the the market? spending you liquid segment biopsy customers. or curious relative perspective Are

You want take to that?

yes. Yes,

saves I And customer sequencing NGS got of -- customers NGS terms in well. in costs building going positioning, So, of pipeline we’ve our the significantly. overall terms mean, is

So we and continue to share. gain win

So overall, our we issues. any mean, haven’t I a I -- customers significant great value proposition, mean we give we seen had and

customers forward business, We biopsy. of increasing growth And continue that to adoption and liquid to increasing that in look to driven of by the number increase. us test volume adopt continues

in going And I’m our now I with we So, reflects as was applications and revenue NGS, we’re just emerging. are $X comes first I’m And my role mean for NGS. bullish And a as as go. there’s mean, more where $XXX million, more and it world yes, where about million. on to going to CFO, cost the And of in huge, sequencing we’re huge down, year opportunity excited be, benefits up I it’s Twist end to well.

showing it I’m back in further I’d turn no remarks. you. Emily Thank to Leproust queue. like the for questions to closing

joining us very you today. for Thank much

very EBITDA -- towards much to look exciting reporting driving months breakeven the very are opportunities and for We ahead. progress am joining. excited at Twist, I and ahead. significant time core our forward Thank the business very you see for adjusted in I

concludes today’s conference for call. you This Thank participating.

You may now disconnect.