OmniAb, Inc. (OABI) Earnings

Management highlights

### Partner Pipeline & Clinical Progression - Ended Q2 2026 with 110 active partners, a well-balanced mix of discovery-stage biotechs, large pharma, and academic institutions, including 8 of the 10 largest global pharmaceutical companies. Added 2 new license partners in Q2: Enrosa Therapeutics and global immunology leader Argenix. - Ended Q2 with 425 active programs, 98% of which include contracted future downstream economics for OmniAb. Total contracted potential milestone payments across all programs exceed $3 billion, with an average contracted royalty rate of ~3.4%. - 34 partner programs are now in clinical stages or approved, with 4 new programs entering the clinic in the first half of 2026, and $340 million in remaining contracted potential milestones for active clinical-stage programs. - Two programs advanced directly from Phase 1 to Phase 3 in Q2: J&J's Romantamib (tri-specific antibody for multiple myeloma) and Merck KGA's Precentabarc Tocentican (first-in-class CCAM5 ADC for metastatic colorectal cancer, supported by strong Phase 1 data). Six clinical programs now come from OmniAb's proprietary transgenic chicken platforms. - Key late-stage updates: TEVA plans to initiate a Phase 2b trial for its anti-IL-15 asset TEV4081 (for vitiligo) in Q4 2026 following encouraging early clinical data; Immunivant's IMVT-1402 (for rheumatoid arthritis and lupus) reported clinically meaningful response rates and remains on track for additional updates in H2 2026. ### Technology Platform Innovation - OmniAb's two newest antibody generation technologies, OmniUltra and OmniDAB, are opening new markets and driving increased partner interest. OmniAb is the only company with a transgenic chicken platform that produces fully human antibody sequences, capable of generating robust immune responses to conserved targets that mammalian platforms cannot target effectively, supporting multiple antibody formats including single domain, common light chain, and ultra-long CDRH3. - Launched late 2025, OmniUltra is the first and only transgenic chicken platform producing antibodies with ultra-long CDRH3s, which can access binding pockets unreachable by other modalities, supporting use in multispecifics, CAR-T, radiopharma, and peptide therapeutics. It has already driven strong adoption and inbound interest for new partner deals. - The Exploration high-throughput single B-cell screening platform combines a capital instrument, single-use consumables, software subscriptions, and service contracts, creating multiple recurring revenue streams. Two instruments were sold in Q2 2026, with growing commercial interest and a expanding sales pipeline; early user feedback highlights Exploration's rapid runtimes, ease of use, and robustness. - OmniDeep, OmniAb's suite of AI/ML in silico tools, has been integrated into the company's technology stack for over three years, and pairs with Exploration's high-throughput data generation capability to accelerate hit identification and improve discovery efficiency. ### Operational Updates - Recently appointed Amechi Wachuku, an experienced global executive, as Chief Operating Officer to lead business growth, particularly for the Exploration platform. - OmniAb will host an Investor and Analyst Day on October 6, 2026 at its Emeryville headquarters, including technology demonstrations, lab tours, deep dives on the Exploration platform, and partner program updates.

Guidance

- Management increased full-year 2026 total revenue guidance to a range of $32 million to $36 million, up from prior guidance, driven by higher-than-anticipated milestone achievements in the first half of 2026. Management notes milestone revenue is front-loaded in 2026, unlike 2025 when it was back-loaded, so lower sequential quarterly revenue is expected in the second half of 2026. - Full-year 2026 GAAP operating expense guidance is narrowed to a range of $84 million to $88 million, while cash operating expense guidance is set at $51 million to $55 million, reflecting ongoing operational efficiency gains. - Year-end 2026 cash and cash equivalents guidance is increased to a range of $37 million to $41 million, up from prior outlooks, reflecting higher received milestone payments in the first half. - The full-year 2026 effective tax rate is expected to remain approximately 0% due to the company's valuation allowance. - Long-term, management expects growing milestone revenue as the partner portfolio matures, followed by growing royalty revenue as programs reach approval, with scalable infrastructure that keeps operating expense growth low, driving long-term profitability.

Segment performance

OmniAb reports three core revenue streams: 1) Antibody discovery technology licensing and milestones: Total Q2 2026 revenue was $13.4 million, up from $3.9 million in Q2 2025, with 98% of active 425 programs including contracted downstream economics. Year-to-date (YTD) 2026 total revenue reached $27.8 million, up from $8.1 million YTD 2025, driven almost entirely by higher milestone revenue from partner clinical progression. 2) Exploration (high-throughput single B-cell screening platform): Generated revenue from the sale of two instruments in Q2 2026, with the platform also delivering recurring revenue from consumables, software subscriptions, and maintenance contracts. This segment currently contributes a small, growing share of total revenue. 3) Discovery and licensing services: Service revenue increased slightly in Q2 2026, driven by new ion channel agreements signed in late 2025 and early 2026. Q2 2026 GAAP operating expenses were relatively flat year-over-year; adjusting for a $2 million one-time asset sale gain in Q2 2025, core R&D and G&A expenses decreased due to realized operational efficiencies. Q2 2026 net loss improved to $5.9 million ($0.05 per share) from $15.9 million ($0.15 per share) in Q2 2025. YTD 2026 net loss improved to $13.6 million ($0.11 per share) from $34.1 million ($0.32 per share) YTD 2025. Cash operating expenses (removing non-cash items: depreciation, stock-based compensation, intangible amortization) are 35-40% lower than GAAP operating expenses, and have trended down over the past two years.

Risks & headwinds

- Milestone revenue is highly variable quarter-to-quarter, depending on partner clinical progression, which can create uneven top-line results. - Early-stage commercialization of the Exploration platform means near-term sales are expected to be lumpy, and the full size of the market opportunity and long-term revenue trajectory for the segment are still being evaluated. - The company continues to operate at a net loss, with a projected ~$15 million in cash burn for full-year 2026, though management notes current cash provides a long runway and growing revenue will close the gap over time. - Partner program clinical progression can be delayed by regulatory requirements or unforeseen trial results, which would impact the timing of milestone revenue.

Analyst Q&A

• Q: An analyst asks about the Exploration platform's sales pipeline, near-term sales cadence, and utilization trends for placed instruments. /

  A: Management remains highly confident in Exploration's long-term opportunity as a meaningful complement to OmniAb's core antibody business. It notes differentiated life science instrumentation creates durable multiple revenue streams from instruments, recurring consumables, and software/service. Management will share more detailed commercial strategy and market opportunity analysis at the October 2026 Investor and Analyst Day.\n\nQ: An analyst asks how improving biotech funding conditions are impacting OmniAb's deal flow, and if there is a lag before increased funding translates to new deals for OmniAb. / A: Management has already seen the positive impact of improved funding: it has recorded steady net growth in partners and programs over the past several years, including during industry funding headwinds. Large pharma partners are pursuing larger programs in high-unmet-need indications, and well-funded preclinical-stage biotechs like new partner Enrosa Therapeutics are also increasingly entering new deals, as seen with the two new partners added in Q2.\n\nQ: An analyst asks what gap closing strategy OmniAb will use to address the expected 2026 gap between operating spend and projected revenue, and if external funding will be needed. / A: Management notes the company started 2026 with $54 million in cash, with projected full-year 2026 cash burn of ~$15 million, providing a long current cash runway. Growing clinical milestone revenue from the expanding maturing portfolio, plus future royalty revenue as programs reach approval, will grow the top line, while scalable infrastructure and expense controls mean additional revenue drops almost directly to the bottom line, closing the gap over time. Management feels well-positioned with current visible late-stage milestone opportunities.\n\nQ: An analyst asks how OmniAb's business model is expected to evolve over a 3-5 year horizon, particularly for deal flow growth. / A: Management's differentiated technology platform drove steady net growth in partners and programs even during industry-wide funding headwinds, demonstrating its durable competitive advantage. Over 3-5 years, milestone revenue will continue to grow as the portfolio expands, and royalty revenue will become an increasing contributor as programs reach approval. Tiered royalty structures add additional upside as product sales grow, creating increasing power in the business model.\n\nQ: An analyst asks how OmniAb is leveraging AI for antibody discovery, and what exposure the portfolio has to AI/Lab-in-the-Loop workflows. / A: OmniAb has integrated AI/ML into its technology stack via the OmniDeep suite of in silico tools, launched more than three years ago. High-quality proprietary data from OmniAb's transgenic platforms and Exploration's high-throughput screening capability feeds into these AI models, improving hit discovery efficiency. The combination of OmniAb's biological discovery platforms, high-throughput data generation from Exploration, and AI tools positions the company well to capitalize on accelerating drug discovery for novel targets, which management views as a long-term tailwind.