Executive Summary

Q2 FY2025 delivered 9% reported and organic revenue growth to $297.0M, with GAAP EPS $0.22 and adjusted EPS $0.42; sequential profitability improved as adjusted operating margin rose to 30.1% (+110 bps q/q) on volume leverage despite incentive comp reinstatement .
Biopharma demand improved (mid-teens growth), led by GMP reagents (+90% YoY) and protein analysis instrumentation; Diagnostics & Spatial Biology grew 12% organically, though segment margin was 3.9% given incentive accruals .
Management maintained the outlook for a Q4 FY25 high-single-digit organic growth exit and now guides H2 adjusted operating margin to be +50–150 bps vs last year (from +100–200 bps prior) due to FX (~1% H2 sales headwind; ~50 bps margin headwind) .
Near-term stock catalysts: evidence of large pharma recovery (earlier than expected), China returning to modest positive growth in Q3, sequential margin expansion, and product cycle momentum (LEO shipments; COMET multiomics pull-through) .

What Went Well and What Went Wrong

What Went Well
- Biopharma demand improved, particularly with large pharma; biopharma sales increased mid-teens, supported by GMP reagents and protein analysis instruments: “earlier than expected… improvements in all types of order activity from our larger pharma customers” .
- Cell & gene therapy momentum: GMP reagents revenue grew over 90% YoY; customer base expanded to 500+, with 85 programs in clinical trials and ~6 in Phase III; TTM GMP growth just over 40% organically .
- ProteinSimple portfolio strength: consumables increased high teens and instrument placements turned positive; early shipments of the next-gen Simple Western LEO platform; Maurice Flex awareness boosted via Waters tie-up .
What Went Wrong
- Diagnostics & Spatial Biology margin dipped to 3.9% (vs 6.0% prior year) on incentive accrual reinstatement despite favorable volume leverage; margin expected to improve as scaling continues .
- FX turned into a new H2 headwind (~1% to revenue; ~50 bps to adjusted operating margins), prompting a reduction in the H2 margin expansion target range to +50–150 bps vs last year .
- China remained a low-single-digit decline in Q2; management expects a turn to modest positive growth in Q3 as stimulus and funding programs flow, but macro remains a watch item .

Financial Results

Metric	Q4 FY2024	Q1 FY2025	Q2 FY2025
Revenue ($M)	$306.1	$289.5	$297.0
Organic Revenue Growth YoY	+1%	+4%	+9%
GAAP EPS ($)	$0.25	$0.21	$0.22
Adjusted EPS ($)	$0.49	$0.42	$0.42
Adjusted Gross Margin %	71.1%	69.5%	70.5%
Adjusted Operating Margin %	33.5%	29.0%	30.1%
Cash from Operations ($M)	$75.5	$63.9	$84.3

Segment performance

Segment Metric	Q4 FY2024	Q1 FY2025	Q2 FY2025
Protein Sciences Revenue ($M)	$214.0	$204.5	$211.6
Protein Sciences Operating Margin %	43.0%	39.4%	41.2%
Diagnostics & Spatial Biology Revenue ($M)	$90.7	$83.2	$84.1
Diagnostics & Spatial Biology Operating Margin %	12.5%	5.1%	3.9%

Selected Q2 FY2025 KPIs

KPI	Q2 FY2025
Cash & Equivalents	$177.5M
Long-Term Debt	$300.0M
Average Diluted Shares	160.6M
Adjusted EBITDA	$96.1M
Adjusted Tax Rate	21.5%
Protein Sciences Organic Growth	+8%
Diagnostics & Spatial Biology Organic Growth	+12%

Notes on Q2 YoY drivers: revenue +9% on improving biopharma (mid-teens), GMP reagents (+90% YoY), strong spatial biology; adjusted op margin flat YoY at 30.1% as favorable volume mix was offset by incentive accrual reinstatement .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Organic Revenue Growth	Q3 FY2025	Not previously specified (company had guided H1 mid-single-digit growth overall)	“Upper range of mid-single-digit”	New/clarified higher end of range
Organic Revenue Growth Exit Rate	Q4 FY2025	High single digits	High single digits (maintained)	Maintained
Adjusted Operating Margin vs PY	H2 FY2025	+100 to +200 bps	+50 to +150 bps; FX ~1% sales headwind and ~50 bps margin headwind	Lowered (FX-driven)
China Growth	Q3 FY2025	Expected stimulus benefit with modest improvement	“Return to modest positive growth”	Maintained/clarified
Dividend	Q2 FY2025	$0.08 per share in prior quarters	$0.08 per share payable Feb 28, 2025	Maintained

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 FY2024, Q1 FY2025)	Current Period (Q2 FY2025)	Trend
Biopharma demand / large pharma	Stabilization in biopharma and China (Q4 PR) ; Q1: stability with early signs of improvement; large pharma run rates stable	Biopharma up mid-teens; earlier-than-expected improvement from large pharma across reagents and instruments	Improving
China	Q4: stabilization ; Q1: low double-digit decline; stimulus tenders expected to aid Q3	Low single-digit decline; expected modest positive growth in Q3	Turning
Cell & Gene Therapy (GMP)	Q1: +60% growth; TTM upper-teens; expanding funnel	+90% growth; TTM just over 40%; 500+ customers, 85 in clinical, ~6 in Phase III	Accelerating (lumpy)
ProteinSimple instruments	Q1: Americas instruments returned to growth; LEO funnel building	Consumables high teens; instrument placements positive; LEO early shipments; Waters co-marketing for Maurice Flex	Improving
Spatial Biology (COMET)	Q1: multiomics enabled (RNAscope + 24 proteins/12 RNA); KOL data; capacity increased	Revenue up mid-teens; multiomic upgrades; high pull-through expected; no mfg constraints	Positive adoption
AI-designed proteins	Q1: first two designer proteins launched	Portfolio now totals six; continued cadence planned	Expanding
Margins / OpEx	Q1: adj op margin 29.0%, incentive accrual headwind; H2 +100–200 bps vs PY	Adj op margin 30.1%; H2 +50–150 bps vs PY due to FX	Sequentially better; FX constraint
NIH exposure	—	U.S. academic January run rate improved; NIH-related revenue exposure mid-single-digit percent; direct NIH <1%	Monitored, low direct risk

Management Commentary

“It is encouraging to see early signs of improvement in the biopharma end-market… We delivered this top-line result with a continued focus on profitability, which resulted in a 30.1% adjusted operating margin, an increase of 110 basis points sequentially.” – Kim Kelderman, CEO .
“Adjusted EPS was $0.42… Q2 revenue was $297 million, an increase of 9% year-over-year… Adjusted gross margin was 70.5%... Adjusted operating margin for Q2 was 30.1%.” – Jim Hippel, CFO .
“For Q2, our GMP reagents revenue increased over 90%… We now have over 500 customers… 85 are in various phases of clinical trials, including 6 currently in Phase III.” – CEO .
“As it pertains to reported revenue growth, with the recent strengthening of the U.S. dollar… [we] expect a headwind of approximately 1% of sales in the back half… negative impact to adjusted operating margins by approximately 50 basis points.” – CFO .
“We added 4 new designer proteins to our catalog in Q2, bringing the total portfolio to 6… You can expect a steady cadence of new designer protein launches going forward.” – CEO .

Q&A Highlights

GMP pull-forward: Several large cell & gene therapy orders originally expected in Q3 were pulled into Q2, contributing about 2 points to total company growth (plus ~1 point from core diagnostics reagents) .
China outlook: Replacement funding and tenders driving sequential improvement; management expects China to return to modest positive growth in Q3, with early Q2 signs across both instruments and reagents .
M&A priorities: Focus on discovery analytics and cell/gene therapy workflow adjacencies; strong balance sheet and clear strategy; Wilson Wolf acquisition expected by end of 2027 .
GMP profitability and outlook: GMP reagents are “very nice profitable… second most profitable product line”; sequential deceleration from 1H strength expected in Q3 given order timing, but underlying growth remains strong .
NIH risk: U.S. academic run rate in January improved; NIH exposure mid-single-digit percent of revenue; direct NIH <1% – management “not overly concerned” about Washington noise .

Estimates Context

We attempted to retrieve S&P Global consensus (Primary EPS Consensus Mean, Revenue Consensus Mean) for Q2 FY2025 and the prior two quarters but were unable to due to an SPGI daily request limit error. As a result, we cannot provide a definitive “vs. Street” beat/miss for revenue or EPS for this quarter. If you’d like, we can re-ping S&P Global later today or supplement with third-party consensus snapshots once accessible [GetEstimates error logs].

Key Takeaways for Investors

Demand inflection: Early and broad-based biopharma recovery (especially large pharma) plus robust cell & gene therapy spending are re-accelerating top-line growth; Q2 organic +9% with strong contribution from GMP reagents and protein analysis .
Margin trajectory: Sequential operating margin expansion (30.1%) should continue into H2 on volume leverage and mix, albeit tempered by FX (-1% sales; ~50 bps margin) and incentive accrual reinstatement .
Product-cycle leverage: LEO launch and ProteinSimple strength (consumables high teens; placements positive) plus COMET multiomics upgrades (high expected pull-through) support sustained growth and improving profitability mix .
Spatial runway: Spatial Biology revenue up mid-teens with multiomics roll-out and no manufacturing constraints; consumables strategy positions COMET for outsized pull-through over time .
China set to turn: While Q2 declined low single digits, stimulus-driven tenders and improved funding should move China to modest positive growth in Q3, aiding the H2 acceleration roadmap .
H2 setup: Management reiterates high single-digit organic exit in Q4 and expects H2 adjusted margins +50–150 bps vs last year; execution on volume, mix, and cost control is key to multiple expansion .
Capital returns/M&A: Continued dividends ($0.08/share declared) and opportunistic buybacks alongside M&A priority targeting discovery and CGT adjacencies; balance sheet remains strong .

All data above are sourced from Bio‑Techne’s Q2 FY2025 8‑K/press release and earnings call, unless otherwise noted: ; prior periods for trend: Q1 FY2025 call and Q4 FY2024 press release ; dividend release .

BIO-TECHNE Corp (TECH)·Q2 2025 Earnings Summary