Alpha Teknova, Inc. Q1 FY2025 earnings call

• Macro Environment: The company had a strong first quarter, with a diverse customer base and limited exposure to geopolitical changes. Less than 4% of revenue comes from academic and government institutions, and less than 5% from outside the US.
• Segment Details: Catalog products grew low double digits; revenue from custom products to biopharma customers grew mid-single digits, while revenue from custom products to life science tools and diagnostics customers declined but would have increased high single digits excluding a large prior-year order.
• Growth Strategy: Focus on early-stage biotech developers, with the number of clinical customer accounts purchasing over $5,000 annually increasing from 13 in 2020 to 48 in 2024. Opportunities for collaboration and acquisitions to expand product portfolio.

LabEssentials revenue in the first quarter of 2025 was $8.1 million, a 12% increase from $7.3 million in the first quarter of 2024, representing approximately 82.65% of the total revenue of $9.8 million. Clinical solutions revenue was $1.2 million in Q1 2025, a 32% decrease from $1.7 million in Q1 2024, making up approximately 12.24% of total revenue. Catalog products, which are ~60% of total revenue, grew low double digits. The custom biopharma segment of the business is expected to grow mid-teens in Q1 2025.

• Reiterated 2025 total revenue guidance of $39 million to $42 million, implying 7% growth midpoint from 2024.
• Catalog products expected mid-single digit growth, biopharma products at least 15% growth, custom life science tools and diagnostics products mid-single digit growth.
• Target gross margin in the high twenties for fiscal year 2025, with operating expenses expected at least $8 million per quarter.

• Second-order effects of biotech funding reduction may cause delays or reductions in purchases from small and midsized biotech customers.
• Geopolitical and tariff policies could have indirect impacts, though no material direct impact expected.
• Revenue in clinical solutions can be affected by customer order timing, with quarter-to-quarter lumpiness due to larger average order sizes.

Q: Comment on cell and gene therapy customer count and demand after FDA leadership change, and month-on-month improvements in macro biotech funding landscape A: Only a day since the change, but customers are in execution mode, and the segment is expected to grow 15% as guided Q: Competitive position of collaboration with Pluristics, impact in 2025 A: Helps build cell therapy workflow and targets current customer base; no material impact expected in 2025, but will build over time Q: Government exposure (4% of revenue) and what's heard from academic/government institutions A: 4% exposure from ~500 academic/government institutions, no material impact seen yet, products are basic research tools and resilient Q: Pull forward of end of first quarter in customer orders and portfolio positioning for FDA/NIH changes A: No clear pull-in detected in catalog business; portfolio supports non-animal models, potential benefit if there's a shift to organoid models