MARAVAI LIFESCIENCES HOLDINGS, INC. Q2 FY2025 earnings call

1. Operational Excellence and Execution: Initiated a restructuring plan to reduce annual operating costs by over $50 million, phased in over 12 months, including headcount and nonheadcount reductions, and a streamlined organizational model. 2. Strategic Levers for Long-Term Value Creation: Focus on revenue diversification and growth across businesses. For BST, invest in new analytical products for biologics and cell/gene therapy. For NAP, expand GMP consumables for mRNA applications. For CDMO, strengthen partnerships and broaden access to technologies via e-commerce and AI. For research customers, expand consumables portfolio and enhance e-commerce infrastructure.

NAP Segment: Revenue was $31.1 million in Q2. Base NAP business (excluding high-volume CleanCap) was up 3% year-over-year, driven by demand for TriLink GMP products. Adjusted EBITDA for NAP was negative $7.3 million. BST Segment: Revenue was $16.3 million in Q2, up 10% year-over-year. Adjusted EBITDA for BST was $10.9 million with an adjusted EBITDA margin of 67%, driven by demand for Host Cell Protein kits, qualification services, and MockV viral clearance products.

1. Withdrawal of Prior Guidance: New leadership team withdrew prior guidance range to conduct a comprehensive business review. 2. 2026 Outlook: Aim to return to sustainable, positive adjusted EBITDA and free cash flow by the second half of 2026. 3. CleanCap Shipment: Encouraged by early indications of a customer for high-volume CleanCap shipment in early 2026, but operating the business as if no CleanCap orders are expected.

1. Macro and Political Headwinds: NAP business facing macro and political challenges. 2. Lumpy Revenue and Quarter-to-Quarter Variability: Business is lumpy with average order sizes greater than run rate, leading to susceptibility to performance by quarter.

Q: Regarding guidance philosophy and visibility for 2026 targets, and quarter-to-quarter guidance A: Bernd and Raj discussed needing time to get arms around the business, focusing on cost control, and that the business will be run positively on free cash and EBITDA regardless of revenue, with no immediate need for additional cost cuts.

Q: Anticipation of China becoming a growth driver A: Raj expects China to be a good growth lever.

Q: Impact of U.S.-China easing on business growth A: Bernd and Raj mentioned non-U.S. regions, including China, as potential growth areas.

Q: E-commerce in strategic review A: Bernd and Raj discussed e-commerce as important for research revenue, with small current contribution but potential for growth via investments in AI and infrastructure.

Q: Near-term trends and customer response to mRNA policy headlines A: Raj noted positive trends, with focus on new KPIs and no material impact from customer funding issues.