• Total Revenue (Q4 2024): $21.5 million
• Product Revenue (Q4 2024): $9.8 million
• R&D Revenue (Q4 2024): $11.6 million
• Annual Revenue (2024): $59.3 million (excluding PAXLOVID)
• Product Gross Margin (Q4 2024): 63% (excluding PAXLOVID)
• Product Gross Margin (2024): 56% (excluding PAXLOVID)
• R&D Expenses (Q4 2024): $12.1 million
• R&D Expenses (2024): $46.3 million
• SG&A Expenses (Q4 2024): $13 million
• SG&A Expenses (2024): $55.1 million
• Net Loss (Q4 2024): $10.4 million
• Net Loss (2024): $65.3 million
• Cash and Equivalents (End of 2024): $73.5 million
• 2025 Revenue Guidance: $64 million to $68 million
• Q1 2025 Revenue Guidance: $8 million to $10 million

• Warning! GuruFocus has detected 5 Warning Signs with CDXS.

Release Date: February 27, 2025

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

Positive Points

• Codexis Inc (NASDAQ:CDXS) has successfully returned its pharma manufacturing business to a healthy growth trajectory.
• Significant progress has been made in reducing costs, strengthening the balance sheet, and defining a path to profitability.
• The ECO Synthesis platform is set to achieve commercial liftoff in 2025, with revenue-generating contracts expected to start in early Q2.
• The company has completed feasibility studies with multiple leading siRNA innovator companies, indicating strong commercial traction.
• Codexis Inc (NASDAQ:CDXS) has established a new long-term agreement with Pfizer, providing future revenue opportunities.

Negative Points

• Revenue for the year ended December 31, 2024, was $59.3 million, down from $62 million the prior year, excluding PAXLOVID.
• Product gross margin decreased to 56% in 2024 from 63% in the prior year, excluding PAXLOVID, primarily due to product mix.
• R&D expenses increased in Q4 2024 compared to the previous year, driven by higher lab supplies and outside services costs.
• SG&A expenses rose to $13 million in Q4 2024, up from $12.2 million in Q4 2023, due to costs associated with executive departures.
• The net loss for the year ended December 31, 2024, was $65.3 million, compared to $84.4 million for the prior year, indicating ongoing financial challenges.

Q & A Highlights

Q: What do you think will drive the value proposition in rare disease markets for Codexis? A: Stephen Dilly, President and CEO, explained that it is a combination of having a validated platform with regulatory precedent and engaging with small companies. Codexis can offer enzymatic solutions that are difficult or impossible to achieve chemically, which can capture significant value from these assets.

Q: How will Codexis communicate progress on agreements with partners to the market? A: Stephen Dilly emphasized the need for discretion due to the competitive advantage partners gain from working with Codexis. While they aim to communicate progress, they prioritize confidentiality and partner relationships, which may limit the details they can share publicly.

Q: Can you provide more details on the seven-plus customers in the pipeline and how they relate to revenue conversion? A: Kevin Norrett, COO, noted that the relationships are multifaceted and evolve over time. Conversations may start with ligation and expand to include ECO Synthesis. The focus is on traction rather than categorization, and revenue growth is expected in the second half of the year as contracts signed in the first half are executed.

Q: What are the expectations for gross margins in 2025, and how is Codexis addressing lower-margin products? A: Georgia Erbez, CFO, stated that they expect gross margins to improve in 2025 by retiring or divesting lower-margin products. The focus is on enhancing the product mix to achieve better margins throughout the year.

Q: How does Codexis plan to achieve cash flow positivity by the end of 2026, and what role does the ECO platform play? A: Georgia Erbez explained that the path to cash flow positivity involves growing the revenue base and decreasing net loss as contracts are signed. The ECO platform is expected to contribute significantly to revenue growth, particularly in the latter half of the year.

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