CODEXIS, INC. Q1 FY2025 earnings call

• First quarter largely in line with expectations, preserving strong financial position with runway to cash flow positivity by end of 2026.
• Pharma Biocatalysis has changing product mix, margin improvement, new customers, and progress with ecosynthesis and ligase businesses.
• Upcoming TIDES meeting in San Diego with multiple presentations on ECO platform, including Codexis' own oral and poster presentations, and collaborators' talks on ligase performance.
• Macro environment could favor ecosystem platform with siRNA field evolution, onshoring production trends, and supply chain dynamics benefiting ecosynthesis technology.
• Three core customer segments: CDMOs are early adopters, with focus on block and tackling to reduce barrier to entry for small and large siRNA drug innovators.

Total revenue for the first quarter ended March 31, 2025 was $7.5 million compared to $17.1 million in the first quarter of 2024. Product gross margin was 55% for the first quarter of 2025, up from 49% in Q1 2024. In Pharma Biocatalysis, product mix is changing with margin improvement, new customers in mid-tier pharma, and progress with ecosynthesis platform including first revenue-generating ECO Contract in March, double-stranded RNA ligase business growing with first orders to large Pharma and drug innovator customers.

• Reiterating 2025 revenue guidance of $64 million to $68 million, with revenue weighted towards back half of the year.
• Comfortable with current consensus estimates for second quarter.
• Ended Q1 with strong cash position ($59.8 million in cash, cash equivalents and investments) to fund operations through achieving cash flow positivity by end of 2026.

Q: Kristen Kluska from Cantor Fitzgerald asked about how to get small and large siRNA drug innovators interested earlier.

A: Stephen Dilly said CDMOs have lower barriers to acceptance as they can talk to existing customers, and it's about demonstrating scale performance, shorter production time, quicker GMP facility setup, and reproducibility of impurity profile.

Q: Tycho Peterson from Jefferies asked about second half ramp and pharma pipeline for RNA ligase orders.

A: Georgia Erbez said growth will come from new ecosynthesis contracts.

Q: Allison Bratzel from Piper Sandler asked about year end 2026 cash flow positivity guidance and GMP facility investment.

A: Stephen Dilly said guidance is based on organic pipeline and revenue ramp without GMP facility, and Georgia Erbez explained GMP facility spend is broken into capital and operating sides, funded in stages.

Q: Dan Arias from Stifel asked about Ligase orders and repeat customers.

A: Stephen Dilly said expect repeat customers, with orders ramping as medicines move from phase 2 to phase 3.

Q: Matthew Hewitt from Craig-Hallum asked about TIDES CDMO collaborators and team roles.

A: Stephen Dilly said CDMOs are successful with ligase, team is coming together, and they're focusing on process scale up and development.

Q: Brendan Smith with TD Cowen asked about machine learning capabilities.

A: Stephen Dilly and Stefan Lutz explained machine learning is applied to ligase and manufacturing, working on customer assets and showing positive results.