CHAMPIONS ONCOLOGY, INC. Q2 FY2025 earnings call

• Core services business saw sustained growth due to industry-leading PDX bank, multi-omic data, operational improvements, and strong customer relationships.
• The industry-leading PDX bank provides valuable insights for drug development, and they are exploring data-licensing as a new revenue stream set to impact revenue, margins, and enterprise value.
• Corellia, the wholly-owned drug development subsidiary, is actively raising capital, with focus on minimizing costs while advancing drug development.
• Q2 was a positive quarter with the core business on track for sustained growth and the data strategy expected to be transformative.

In the second quarter, revenue was $13.5 million, a 17% increase from the same period last year. The core services business saw sustained growth driven by the industry-leading PDX bank, multi-omic data, operational improvements, and strong customer relationships. The core services segment contributed significantly to the overall revenue. For the first half, total revenue was $27.6 million, a 14% increase from the first half of 2024. Gross margin improved to 45% in Q2 compared to 43% last year, and to 48% in the first half compared to 41% last year.

• Revenue growth for fiscal 2025 is expected to be at least between 10% and 15%.
• Anticipate a slight quarterly sequential decline in research service revenues next quarter, with reacceleration expected in the fourth quarter and continuing into fiscal 2026.
• Quarterly adjusted EBITDA will remain positive.

• Challenging funding environment for Corellia, though engaged with bankers to support capital raise efforts.

Q: Please provide any color on the market dynamics? Other CROs are saying that there is some lumpiness in the funding environment. What are you seeing?

A: Yes. We are cautiously optimistic that funding is coming back, especially from big pharma and the biotech sector, though not back to where it was a couple of years ago but improving.

Q: Are there any new tests or services you could be rolling out to drive further growth?

A: They have been focused on data monetization, with plans to introduce a new revenue stream through data-licensing, and their core business in Vivo, Ex-Vivo, and biomarker studies remains strong.