Executive Summary

Q4 2025 revenue of $36.4M and diluted EPS of $(0.06); revenue modestly beat S&P consensus ($35.3M) and EPS beat by $0.09, with gross margin stepping up to ~38% on mix and fixed-cost absorption . Revenue est: $35.3M*, EPS est: $(0.15)*.
FY25 results met the company’s full-year guidance: revenue $128.9M and Adjusted EBITDA $19.5M; management reiterated its mid-term targets (12% revenue CAGR, >25% EBITDA margin) .
Transition to calendar fiscal year; new 7‑month “stub” guidance (May–Dec 2025): revenue $74–$76M, Adjusted EBITDA $12–$14M, net loss $(19.8)–$(17.8)M; management expects stub-period gross margins in the low-30% range .
Business development momentum: 9 new programs signed in FY25; post-Q4 adds include a late-stage GLP‑1 therapeutic and a Phase 2 dermatology program; late-stage pipeline now at 11 programs, positioning mid-term growth and utilization upside .

What Went Well and What Went Wrong

What Went Well
- Margin inflection: Q4 gross margin was the highest of the year (~38%) on favorable timing/mix and better fixed-cost absorption; CFO expects low‑30% gross margins for the transition period, above FY25’s ~31% baseline .
- Commercial pipeline momentum and mix shift: 9 new programs in FY25 plus a post-quarter late-stage GLP‑1 win and Phase 2 dermatology program; management highlighted a stronger hunting approach and better pipeline quality versus last year .
- Operational execution: On-time/in-full delivery rate hit 97% in FY25; fermentation achieved record output; FDA audit of quality systems yielded a “highly favorable” outcome .
What Went Wrong
- Q4 mix headwinds in CDMO: CDMO revenue declined $5.6M YoY on lower development revenue and aseptic volumes, partially offset by +$4.1M HA manufacturing revenue tied to a large customer’s supply chain initiatives .
- FY25 gross profit modestly lower: FY25 gross profit fell $1.6M YoY as lower CDMO gross profit (mix, lower development revenue/aseptic volume) offset HA gross profit gains; FY25 net loss $(38.7)M included $7.7M loss on asset sale and higher interest expense .
- Legacy/legal tail: FY25 SG&A included $11.6M legacy items (vs. $11.9M prior year); Q4 still carried $2.0M legacy costs, though down YoY; management continues to work through legacy matters and system upgrades (ERP) .

Financial Results

Quarterly summary (oldest → newest)

Metric	Q2 2025	Q3 2025	Q4 2025	Q4 2025 Consensus
Revenue ($M)	$32.6	$35.2	$36.4	$35.3*
Diluted EPS ($)	$(0.25)	$(0.47)	$(0.06)	$(0.15)*
Gross Profit ($M)	$11.1	$9.8	$14.0	—
Gross Margin (%)	34.0% (calc from )	27.8% (calc from )	38.4% (calc from ; CFO: “about 38%” )	—
Adjusted EBITDA ($M)	$6.5	$5.7	$9.1	—

Year-over-year – Q4

Metric	Q4 2024	Q4 2025	YoY
Revenue ($M)	$37.9	$36.4	(3.9%) (calc from )
Diluted EPS ($)	$(0.19)	$(0.06)	+$0.13
Gross Profit ($M)	$17.3	$14.0	$(3.3)
Adjusted EBITDA ($M)	$10.4	$9.1	$(1.3)

Segment/mix movement (as disclosed)

Period	CDMO Revenue YoY Δ	HA Manufacturing Revenue YoY Δ	Commentary
Q4 2025	$(5.6)M	+$4.1M	Lower dev revenue/aseptic volumes; HA supported by largest customer’s supply chain shift
FY 2025	$(6.5)M	+$7.1M	Similar dynamics; HA strength offset CDMO decline

KPIs and operational metrics

KPI	Q4/FY25 Result
On-time/in-full (OTIF) delivery	97% FY25
Late-stage programs	11 current (up from 10)
New programs in FY25	9 (3 added in Q4)
Post-Q4 wins	Late-stage GLP‑1 program; Phase 2 dermatology program
Q4 Cash from Ops / FCF	>$5M / >$3M; impacted by ~$2M one-time legacy expenses
ERP go-live / cost	Q1 2026; ~$0.6–$1.0M investment
FY25 gross margin baseline	~31% (CFO)

Notes: Consensus values marked with * are from S&P Global. Values retrieved from S&P Global.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY2025	$126.5–$130.0M (reiterated in Q3)	Actual: $128.9M	Met
Adjusted EBITDA	FY2025	$19–$21M (reiterated in Q3)	Actual: $19.5M	Met
Revenue	May 26–Dec 31, 2025 (7‑mo)	N/A	$74–$76M	New
Adjusted EBITDA	May 26–Dec 31, 2025 (7‑mo)	N/A	$12–$14M	New
Net Loss	May 26–Dec 31, 2025 (7‑mo)	N/A	$(19.8)–$(17.8)M	New
Fiscal calendar	—	Legacy May YE	Moving to Dec 31 YE (effective 2025)	Announced

Management also guided to low‑30% gross margins for the transition period, above FY25 baseline ~31% overall .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2025, Q3 2025)	Current Period (Q4 2025)	Trend
ERP / digital enablement	Live production monitoring added; ERP planned Q1’26	ERP on track for Q1’26; align with calendar YE; supports efficiency and controls	Execution progressing
Largest customer expansion	Expansion inflection in 2027 reiterated	2027 inflection reiterated; increased take-or-pay and APAC expansion	Visibility improving
Pipeline & BD “hunting”	50+ opportunities; more multinationals; 6–7 new customers YTD	9 new programs FY25; post‑Q adds incl. GLP‑1, derm; late-stage programs now 11	Strengthening
Margins/efficiency	Q2 margin improvement (mix, price, overhead)	Q4 gross margin ~38% (year’s high); low‑30% for stub period	Positive inflection
Tariffs/onshoring	Repatriation interest increasing; qualitative momentum	Tariff talk seen as noise, but onshoring tailwinds material; CDMOs key beneficiaries	Tailwinds rising
Regulatory/quality	—	FDA audit “highly favorable” outcome; quality system highlighted	Quality validated
Capacity/capex	New 5‑head isolator doubled fill/finish capacity; ~$300M annual rev capacity	Better fixed cost absorption evident in Q4; positive on utilization trajectory	Underpinning margins

Management Commentary

“We remain on track to achieve our stated goals of achieving a 12% revenue CAGR and increasing EBITDA margins to more than 25% over the midterm.” — CEO, Paul Josephs .
“Fourth quarter adjusted EBITDA was the strongest of the year… [and] the company will be moving its fiscal year end to align with the calendar year effective for the 12/31/2025 calendar period.” — CFO, Ryan Lake .
“The FDA conducted a general audit of our quality systems… [it] resulted in a highly favorable outcome… feedback… has been overwhelmingly positive.” — CEO, Paul Josephs .
“We’re playing offense… significant increases in our investment in sales and marketing… opportunities in APAC, Europe, Israel… part of potential onshoring.” — CEO, Paul Josephs .

Q&A Highlights

Largest customer dynamics: Management cited strategic supply chain moves by the customer away from another third party, bringing additional aseptic volumes over time; 2027 remains the key inflection with higher minimums and APAC expansion .
New GLP‑1 agreement: Late-stage program with a leading developer in obesity; timing for potential impact framed around 2029–2030; details undisclosed but seen as meaningful .
Margin trajectory: Q4 gross margin ~38% (highest of year) on timing/mix and fixed-cost absorption; stub-period gross margins expected low‑30% with variability by mix/volume .
Fiscal year change read-through: Had they not changed the calendar, FY26 revenue would be similar to FY25, with Adjusted EBITDA improving on efficiencies; the step‑function ramp hinges on the 2027 expansion and late-stage pipeline commercialization .
Cash and ERP: Q4 cash from ops >$5M; FCF >$3M despite ~$2M legacy items; ERP go‑live targeted Q1’26 with ~$0.6–$1.0M investment and robust validation/controls plans .

Estimates Context

Coverage remains thin: only 1 estimate for Q4 revenue/EPS; Q4 actuals beat both revenue and EPS consensus. Q3 missed on revenue and EPS vs consensus.

Metric	Q3 2025 Actual	Q3 2025 Consensus	Q4 2025 Actual	Q4 2025 Consensus
Revenue ($M)	$35.2	$33.229*	$36.4	$35.308*
Diluted EPS ($)	$(0.47)	$(0.15)*	$(0.06)	$(0.15)*
# of Estimates (EPS/Rev)	2 / 2*	—	1 / 1*	—

Implications: Estimate dispersion is limited; given Q4 margin strength and baseline gross margin commentary (low‑30% for stub), sell-side models likely raise near-term gross margin and EBITDA assumptions modestly. Mid-term revisions hinge on 2027 volume inflection, late-stage program PPQs/commercialization timelines, and GLP‑1 pathway.
Notes: Consensus values marked with * are from S&P Global. Values retrieved from S&P Global.

Key Takeaways for Investors

Q4 delivered a quality beat: revenue and EPS exceeded consensus with the best gross margin of the year (~38%), signaling improved mix and absorption; this underpins near-term EBITDA resilience despite limited top-line elasticity .
FY25 guidance met; “stub” guidance looks conservative on margins (low‑30s) relative to Q4, but mix/timing variability warrants caution; execution on HA and aseptic volumes is the swing factor .
Business development momentum is real: 9 FY25 wins plus late-stage GLP‑1 intake and pipeline now at 11 late-stage programs; increased multinational engagement supports mid-term utilization and mix upgrades .
2027 remains the structural catalyst: larger minimum volumes and APAC expansion with a key customer are the critical step-up in throughput and EBITDA margin trajectory; monitor PPQ starts and commercialization transitions .
Quality and operations de-risking: favorable FDA audit, 97% OTIF, and record fermentation output together reduce execution risk; ERP go‑live in Q1’26 should enhance controls and efficiency .
Balance sheet/cash: Positive Q4 operating cash flow and FCF despite legacy expense drag; continued reduction of external consultants and legacy charges can further support EBITDA-to-cash conversion .
Trading setup: Near-term stock reaction likely keys off margin durability into the stub period and tangible BD milestones (late-stage wins/PPQs). Medium term, the narrative turns on 2027 volume inflection and converting late-stage pipeline to revenue to approach the >25% EBITDA margin target .

Citations:

Q4/FY25 press release and financials:
Q4 2025 earnings call transcript (prepared remarks and Q&A):
Q3 2025 earnings call transcript:
Q2 2025 earnings call transcript: