• Revenue: $84.7 million for Q4, a 27% increase year-over-year; $313 million for fiscal 2024, a 28% increase over fiscal 2023.
• Gross Margin: 45.1% for Q4; 42.6% for fiscal 2024, up from 36.6% in fiscal 2023.
• Cash Balance: $276.4 million as of September 30, 2024.
• SynBio Revenue: $33.9 million for Q4, a 28% increase year-over-year; $123.5 million for fiscal 2024, a 26% increase over fiscal 2023.
• NGS Revenue: $45.5 million for Q4, a 23% increase year-over-year; $169.1 million for fiscal 2024, a 37% increase over fiscal 2023.
• Biopharma Revenue: $5.3 million for Q4; $20.3 million for fiscal 2024.
• Adjusted EBITDA: Loss of approximately $17 million for Q4; loss of approximately $93.5 million for fiscal 2024, an improvement of $54 million over fiscal 2023.
• Operating Expenses: $74.3 million for Q4; $354 million for fiscal 2024, including a $45 million impairment charge.
• Capital Expenditures: $5 million for fiscal 2024, a reduction from $28 million in fiscal 2023.
• Orders: $88.2 million for Q4, a 24% increase year-over-year; $344.2 million for fiscal 2024.

• Warning! GuruFocus has detected 3 Warning Signs with TWST.

Release Date: November 18, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Twist Bioscience Corp (NASDAQ:TWST) reported a record quarter in revenue and margin growth, with a 27% year-over-year increase in revenue to $84.7 million.
• The company achieved a gross margin of 45.1% for the quarter, exceeding guidance and demonstrating significant improvement from the previous year.
• Twist Bioscience Corp (NASDAQ:TWST) has successfully expanded its customer base to over 3,500 customers across multiple industries, indicating strong market penetration.
• The company's Express product portfolio and NGS tools portfolio have shown continued growth, contributing positively to revenue and market share.
• Twist Bioscience Corp (NASDAQ:TWST) is on track to reach adjusted EBITDA breakeven, with a focus on becoming cash flow positive and driving profitable growth.

Negative Points

• Despite revenue growth, Twist Bioscience Corp (NASDAQ:TWST) reported an adjusted EBITDA loss of approximately $17 million for the fourth quarter.
• Operating expenses, excluding cost of revenues, remained high at $74.3 million for the quarter, highlighting challenges in cost management.
• The Biopharma segment, while showing some growth, remains a small portion of overall revenue and faces challenges in commercial execution.
• The company faces potential headwinds from competitors manufacturing outside the US, which could impact market dynamics.
• Twist Bioscience Corp (NASDAQ:TWST) has not assumed a ramp in MRD (minimal residual disease) in its 2025 guidance, indicating uncertainty in this growth area.

Q & A Highlights

Q: Can you provide insights on the trends for Express Genes and new products within the SynBio mix throughout the year and specifically in Q4? Additionally, how should we think about OpEx trends for R&D and SG&A next year? A: We expect modest, inflationary increases in OpEx, with a significant portion in Q1 due to annual merit and bonus increases. For Express Genes, we anticipate continued sequential improvement in gross margin each quarter, aiming for a 50% gross margin by Q4. - Adam Laponis, CFO

Q: What is Twist's exposure to NIH budgets, and have you noticed any changes in competitive behavior or market share gains? A: Our exposure to NIH budgets is minimal, less than 1%, presenting an opportunity for market share growth. All our DNA is manufactured in the US, which is increasingly important to customers concerned about supply chain security, providing us a competitive advantage. - Emily Leproust, CEO

Q: How do new innovations in next-gen sequencing (NGS) affect Twist's revenue opportunities? A: These innovations are positive for us as they emphasize quality and performance, areas where we excel. Our rapid R&D capabilities allow us to stay at the forefront, leveraging both innovation and commercial execution to grow revenue. - Emily Leproust, CEO

Q: Could you elaborate on the assumptions for the 2025 guidance, particularly for NGS and SynBio markets? A: We have not assumed an MRD ramp but expect continued improvement in liquid biopsy and customer base expansion. For SynBio, we anticipate growth in net new accounts and Express Genes, contributing to sequential gross margin improvement throughout the year. - Adam Laponis, CFO

Q: Can you provide an update on the DNA storage initiative and any associated milestones or customer engagements? A: We are focused on developing a terabyte-scale product using enzymatic chemistry for cost and sustainability benefits. While it's early to discuss customers, significant progress is being made in technology development. - Emily Leproust, CEO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.