Release Date: March 11, 2025

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

Positive Points

• MaxCyte Inc (NASDAQ:MXCT) reported a strong year in 2024 with a return to core revenue growth and strategic improvements in operations.
• The acquisition of SecureDX is expected to enhance MaxCyte's offerings by providing safety assessments in cell and gene therapy development.
• MaxCyte's core business revenue reached $32.5 million, at the high end of their pre-announced range.
• The company expanded its SPL portfolio significantly, with 6 new SPL agreements signed in 2024.
• MaxCyte ended 2024 with a strong cash position of $190.3 million and no debt, indicating financial stability.

Negative Points

• Total revenue for 2024 declined by 6% compared to 2023, primarily due to multiple approval milestones received in the previous year.
• Instrument revenue was impacted by customer caution on capital expenditure, leading to a decrease from $8.3 million in 2023 to $7.1 million in 2024.
• Gross margin decreased to 74% in Q4 2024 from 90% in Q4 2023, indicating pressure on profitability.
• SPL program-related revenue decreased from $11.5 million in 2023 to $6.1 million in 2024.
• The operating environment remains challenging, with no significant improvement in the macroeconomic conditions expected in 2025.

Q & A Highlights

• Warning! GuruFocus has detected 4 Warning Signs with MXCT.

Q: Can you provide insights into the core business growth guidance excluding SecureDX, and how it reflects market dynamics and long-term growth expectations? A: Maher Masood, President and CEO, explained that the company is witnessing continued growth across both research and clinical customer bases. The operational changes and execution strategies implemented are expected to sustain year-over-year growth. Doug Swarsky, CFO, added that while instrument sales declined, there are opportunities for improvement, and PA sales were strong, which is factored into their conservative growth forecast.

Q: What is the revenue track record for SecureDX, and are there any anticipated changes in its business model? A: Maher Masood noted that SecureDX began commercialization in 2024, and they foresee significant growth. The business model is service-based with unique offerings and minimal competition. The integration with MaxCyte is expected to enhance growth, and while the current model is fee-for-service, there is potential for a subscription-based model in the future.

Q: How will the integration of SecureDX impact MaxCyte's cost structure and operations? A: Maher Masood stated that the integration costs are immaterial due to existing commercial infrastructure. Doug Swarsky added that while there are operational costs, they are not significant, and the business is expected to contribute positively to cash flow in the short term due to scalable investments.

Q: What is MaxCyte's exposure to academic markets and NIH spending, and has there been any change in this environment? A: Doug Swarsky mentioned that the exposure to NIH grants is minimal and not expected to impact the business significantly. Maher Masood emphasized that the company's focus is on biotech and later-stage companies, making NIH exposure immaterial.

Q: Are customers signing SPL agreements at the same stage, and what is the outlook for new SPL agreements? A: Maher Masood confirmed that customers are still signing SPL agreements at the pre-IND stage. The company works with customers for about a year before finalizing agreements, and they are confident in signing 3 to 5 new SPLs annually, reflecting the health of their business and platform.

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