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Twist Bioscience Corp (TWST)·Q2 2025 Earnings Summary

Executive Summary

  • Record revenue of $92.8M (+23% YoY, +4.6% QoQ) and gross margin of 49.6% (ahead of guidance), with 9th consecutive quarter of sequential growth; segment strength across SynBio ($36.0M, +21% YoY), NGS ($51.1M, +25% YoY), and Biopharma ($5.7M, +21% YoY) .
  • Revenue modestly beat S&P Global consensus, while EPS missed and EBITDA came in below consensus: Revenue $92.8M vs $92.0M estimate; EPS -$0.66 vs -$0.543 estimate; EBITDA -$35.2M vs -$29.2M estimate (non-GAAP adjusted EBITDA was -$14.8M) (*Values retrieved from S&P Global).
  • FY25 guidance maintained for revenue ($372–$379M) but improved for gross margin (from ~49.0% to ~49.5%) and adjusted EBITDA (from -$55 to -$60M to -$48 to -$53M); Q3 guide set at $94–$97M revenue and adjusted EBITDA ~-$13M .
  • Strategic catalyst: Spin-out of DNA data storage as Atlas Data Storage with $155M funding, sharpening focus on core businesses and accelerating path to adjusted EBITDA breakeven by end of FY26 .

What Went Well and What Went Wrong

What Went Well

  • Record revenue and margin expansion: “ninth consecutive quarter of sequential growth and record performance across revenue, gross margin and adjusted EBITDA” (GM 49.6% vs 41.0% YoY) .
  • Operational execution and capacity: COO detailed a ~200% capacity increase and ~20% turnaround-time reduction for key NGS workflows with fixed headcount, positioning for MRD growth .
  • Strategic focus and product momentum: Spin-out of DNA storage to Atlas; expanded NGS portfolio (HT UDI adapters) and collaboration with Element for end-to-end workflows, enhancing adoption in agbio and diagnostics .

What Went Wrong

  • Earnings metrics vs consensus: EPS missed (-$0.66 vs -$0.543*), and EBITDA missed (-$35.2M vs -$29.2M*) despite strong top-line beat; adjusted EBITDA improved to -$14.8M but remains negative (*Values retrieved from S&P Global).
  • SG&A inflation: SG&A rose to $63.7M (including +$5.3M in non-cash stock-based comp), pressuring operating loss despite margin gains .
  • Continued macro uncertainty: Management highlighted academic funding pressure and tariff risks; while Twist expects minimal direct impact, broader market wallets remain mixed, necessitating ongoing share-taking to hit H2 targets .

Financial Results

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Millions)$75.3 $88.7 $92.8
Gross Margin (%)41.0% 48.3% 49.6%
Net Loss ($USD Millions)$(45.5) $(31.6) $(39.3)
Diluted EPS ($USD)$(0.79) $(0.53) $(0.66)
Adjusted EBITDA ($USD Millions)$(26.8) $(16.3) $(14.8)
Segment Revenue ($USD Millions)Q2 2024Q1 2025Q2 2025
SynBio$29.8 $34.4 $36.0
NGS$40.8 $48.6 $51.1
Biopharma$4.7 $5.7 $5.7
KPIsQ2 2024Q1 2025Q2 2025
Customers shipped (approx.)2,253 2,376 2,431
Genes shipped (approx.)193,000 205,000 227,000
Top 10 NGS customers (% of NGS)——~43%
Biopharma active programs——95
Biopharma new programs (quarter)——64
Q2 2025 Actual vs Wall Street ConsensusConsensus*Actual
Revenue ($USD)$92.0M$92.8M
Primary EPS ($USD)$(0.543)$(0.66)
EBITDA ($USD)$(29.2)M$(35.2)M

*Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total RevenueFY2025$372–$379M $372–$379M Maintained
SynBio RevenueFY2025$144–$147M $144–$147M Maintained
NGS RevenueFY2025$205–$209M $205–$209M Maintained
Biopharma RevenueFY2025$23M $23M Maintained
Gross MarginFY2025~49.0% ~49.5% Raised
Gross MarginQ4 FY2025≥50% >50% Raised wording
Adjusted EBITDAFY2025$(55)M to $(60)M $(48)M to $(53)M Improved
Total RevenueQ3 FY2025—$94–$97M New quarter guide
SynBio RevenueQ3 FY2025—~$37–$39M New quarter guide
NGS RevenueQ3 FY2025—~$51–$52M New quarter guide
Biopharma RevenueQ3 FY2025—~$6M New quarter guide
Adjusted EBITDAQ3 FY2025—~$(13)M New quarter guide

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
AI/technology initiativesLaunched FlexPrep™ Ultra-High Throughput library prep with Twist-developed enzyme; collaborated with Absci (AI) .Continued NGS workflow innovation; enzyme-improved workflows in pipeline; collaboration with Element to co-develop end-to-end sequencing solutions .Expanding platform and partnerships
Supply chain/tariffs/macroStrong execution despite macro; product portfolio diversification .Expect minimal tariff impact due to US sourcing and miniaturized chemistry; tariffs seen as headwind for competitors; academic funding pressures acknowledged .Vigilant stance; potential share gains
Product performanceExpress portfolio and NGS tools drove growth in FY24; record revenue .Express Genes promotion to drive academic adoption; NGS revenue +25% YoY; expanded HT UDI adapters for high-throughput indexing .Continued strength; academic conversion targeted
Regional trendsFY24 revenue diversified; operational scale .Americas ~$55.2M (+20% YoY), EMEA ~$30.6M (+38% YoY), APAC ~$7.0M; China ~1.5% of total revenue .EMEA accelerating; China small
R&D execution/capacityPlatform enhancements; LEED-certified facility .Capacity +~200% for NGS MRD workflows; turnaround time -~20%; internally developed polymerase reducing supplier dependency and cost .Scaling efficiently for MRD
Regulatory/legalGeneral forward-looking risk disclosures .No new regulatory issues; continued risk disclosures; academic funding policy watched .No change

Management Commentary

  • CEO: “we reported our ninth consecutive quarter of sequential growth and record performance across revenue, gross margin and adjusted EBITDA” .
  • CEO on spin-out: “launch of Atlas Data Storage… allowing Twist to accelerate our journey toward profitability” .
  • CFO: “Gross margin came in higher than expected at 49.6%, primarily due to increased revenue, volume leverage and faster-than-anticipated gains on continuous process improvements” .
  • COO: “With a fixed headcount, we increased capacity by about 200% and lowered turnaround time by approximately 20%” (NGS MRD workflows) .
  • CEO: “we booked more than $100 million of orders in each of the last 2 quarters” .

Q&A Highlights

  • Tariffs and macro: Management expects minimal direct impact; tariffs could be a competitive headwind for peers; guidance comprehends tariff and NIH funding dynamics .
  • Academic promotions: Express Genes promotion intended to convert makers to buyers; expected margin-positive via volume; promotion runs through fiscal year .
  • Customer concentration: Top 10 NGS customers ~43% of NGS revenue; rotation occurs, with growth expected across top 10 and broader base; MRD ramps not assumed in H2 guidance .
  • Spin savings and profitability path: Atlas spin reduces ~$5M per quarter cash burn starting Q4; sequential adjusted EBITDA improvement expected; breakeven by end of FY26 .
  • Orders and funnel: >$100M in orders in each of last two quarters; strong funnel across SynBio, NGS and Biopharma .

Estimates Context

  • Q2 2025: Revenue beat; EPS and EBITDA missed vs S&P Global consensus (see table above) (*Values retrieved from S&P Global).
  • Next quarter (Q3 2025): Street revenue consensus ~$95.6M*, EPS ~-0.572*, EBITDA ~-26.7M*, broadly consistent with company revenue guidance $94–$97M; company expects adjusted EBITDA loss of ~-$13M (*Values retrieved from S&P Global).
Q3 2025 OutlookConsensus*Company Guidance
Revenue ($USD)~$95.6M$94–$97M
Primary EPS ($USD)~$(0.572)—
EBITDA ($USD)~$(26.7)MAdj. EBITDA ~$(13)M

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • Revenue momentum and margin expansion continue, with 9 consecutive sequential growth quarters and GM approaching >50% in 4QFY25; focus on operational leverage should sustain margin trajectory .
  • The Atlas spin-out is a meaningful catalyst, removing ~$5M/quarter cash burn from Q4 onward and sharpening focus on core businesses, accelerating adjusted EBITDA breakeven to end-FY26 .
  • Near-term trading: Expect narrative centered on margin beats and spin-out benefits; watch for academic conversion pace and tariff developments—management frames tariffs as a competitive tailwind .
  • Medium-term thesis: NGS workflow leadership and capacity scaling for MRD, coupled with product expansions (HT UDI adapters, collaborations with Element/Curio), support share gains across diagnostics and agbio .
  • Risk checks: EPS/EBITDA variability given SBComp and macro funding; top customer concentration in NGS (~43%) warrants monitoring; guidance does not assume MRD ramps in H2 .
  • Execution markers: Track sequential adjusted EBITDA improvement, GM progression, and Q3 delivery within $94–$97M revenue guide; monitor orders and biopharma program growth .
  • Valuation drivers: Sustained growth with improving profitability metrics and de-risked cash burn from Atlas spin should support multiple expansion if margin trajectory continues .

Additional Relevant Press Releases (Q2 FY25)

  • Expanded collaboration with Element Biosciences for end-to-end NGS workflows (Twist exclusive provider of Trinity-compatible kits; joint commercial activities) .
  • Launch of high-throughput UDI adapter system (3,072 unique indexes) enabling multiplexing and sample batching at scale .
  • Collaboration with Curio Genomics to accelerate agrigenomics workflows .

Notes

  • Non-GAAP adjusted EBITDA reconciliations provided in press materials; company reiterates limitations of forward-looking non-GAAP guidance .
  • All consensus figures marked with an asterisk are Values retrieved from S&P Global.