Q4 2019 Earnings Call
2019 fourth quarter and full year financial results conference call.
At this time, all participants minor in listen only mode.
I have two speakers presentation, there will be a question answer session.
Ask a question during the session we need to press star one what are your telephone.
Please be advised that today's conference is being recorded.
Require any further assistance please press star zero.
And the conference over to your Speaker today jumped <unk> Chief Financial Officer. Thank you and please go ahead Sir.
Alright, Thank you Chris.
Good afternoon, everyone and thank you for joining us today for twist bias Science conference call to review, our fiscal 2019 fourth quarter and full year financial results and business progress.
Please review the press release, we issued earlier today.
Which is available at our website at Www Dot twist bio science Dot com.
With me on todays call as dR.M. Leila Prost.
He all and founder co founder twist.
Family will begin with a review of overall progress and twist businesses.
I will report on our financial and operational performance and Emily Wholl discuss our upcoming milestones and direction.
We'll then open the call up for questions. As a reminder, this call is being recorded.
Audio portion will be archived in the Investor section of our website and will be available for one week.
During today's presentation will make forward looking statements.
Then the meaning of the federal Securities laws forward looking statements relate to future events or future financial or operating performance.
Our expectations and beliefs regarding these matters may not materialize and actual results and financial periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected.
These risks include those set forth in the press release, we issued earlier today as well as Louis more fully described in our filings with the Securities Exchange Commission.
The forward looking statements in this presentation are based on information available to us as of the date hereof.
And we disclaim any obligation to update any forward looking statements, except as required by law.
With that.
I will now turn the call over to our Chief Executive Officer, and co founder Dr. Emilie look crossed.
Thank you Jim.
Good afternoon, everyone.
She's came clean I seen with the yields continued innovation and execution.
We shipped a plug to more than 1300 kissed the mills compared to about 700 in fiscal 2018.
We reported record revenues of 54.4 million, though.
More than doubled the 25.4 men that have in revenue for the CEO period in 2018 and substantially more than our initial guidance provided approximately one year ago.
Fiscal 2018, yeah cool.
In addition.
We will soon with me on that I was in auto deficit 9.4 me on that off last you.
Well what growth wasn't policy for the year, a tremendous gord accomplished which validates our business model.
Well, we bought it so the growth synthetic biology, an exceptional growth in India.
Oh, you can be seen in writing platform continues to provide significant advantages.
Nothing really you know revenue generating businesses, but a slowing our biopharma and you need that the storage vertical market opportunities.
Oh success in fiscal 2019 was due to two key factor.
Excellent products.
Yes, good execution.
I'd like to highlight though accomplishments for the year and this will give you some insight into the future girls I saw businesses.
Beginning with excellent products in Symbio, we shipped about 81000 genes in the fourth quarter fiscal 2019 compared to about 71000 in the fourth quarter of 2018.
The full year 2019, we shipped more than 20 288000 genes.
All of which are unique sequences.
This is incredible skin.
And we received 2.4 X the number of purchase orders.
Rich with smaller in size, they about 60%, indicating that we are starting to reach customers in the long said of the market.
Given the more importantly, we the Leeville 8 billion basis.
If we include gene fragrance labor pools, and vast library as well as Ngs products that is a lot of DNA pursued a fraction of what you should keep us.
It's drive these numbers.
Although the course of the yes, we introduced several key products in the center in the Symbio market.
Leveraging commitments to innovation, we introduced long genes up to five Kb.
And we launched long, Oregon nucleotide up to 300 basis in them.
We believe is the longest commercial flooring 40 becomes.
It's a product continues to demonstrate our ability to push a button batteries have with responsibility not equal synthesis at 300 basis and an error rates of one in 2000 business.
Of an exceptional quality that can be useful gene editing reserves as well as the best to rich and other applications, both long genes and long only goes.
Put simply because of continued investments in R&D commitment to him and I tried never complacent, but whether that seem to front you're fine.
We've made incredible inroads into the Sinbo market could we see don't you have about 10% bucket shale. So we're only scratching the surface of whats placebo.
As we look ahead into 2020, who will continue to cell, killing customers and we plan to introduce product line extension that we believe will allow us to meet the needs of large pharmaceutical companies that require larger quantities of yes.
In addition.
Well, we need to produce a product that we believe we allow our gene Prime minister of even low widely adopted by the long tale of the market.
We need both of these market areas present growth opportunities can you just some acquisition.
And in children customer relationships.
Continuing to take market share from a competitor.
So genomics and targeted ngs in the fourth quarters of fiscal 2019, we shipped a target enrichment products to 100.
60 customers with 36 of these customers know in production.
I'd like to committed to reflect on the growth of the Ngs business.
Okay. Tony 18, we started as a single offering of DNA approved within a target enrichment last year, we ribadu, but screen millions in revenue and I've rapidly scaling revenues to 21 million barrels in fiscal 2019.
Today noted two years after all commercial launch we have a robust and she is product offering that can be integrated with multiple sequencing workflows bull standout and customize research.
Well I should have a nickel reflects the high quality default products now verified by skip typical scientist went to suggested Kelly sharing data that an l. being is convince other potential customers.
Oh success is not an accident.
We analyze the market needs and then applied a silicon technology to provide a better product that innovated entrenched competitors.
Yes, I'll call offerings.
Yeah, we introduced new fixed panels, including the mouse Xome and met the country old panel, both of which support clinical research.
Just doesn't need to be in value.
We began by targeting large customers.
Can't keep tracking 88 opportunity.
Looking to ask rules fell 2020 were planning product extensions that would be some key market theory as what we believe a silicon based in erection Petro offers us an advantage of a competent those.
We need the future liquid biopsy market.
He is one such area with tremendous potential for growth both as an industry enough itself and it's the full twist specific image.
One college as a whole is a built unique area free search for improved diagnosis and patient stratification.
Our near term line extensions will be focused on addressing that occurring market need.
In addition.
We have made initial inroads in converting to sneak microarray markets twins, yes.
With a customer now moving into the variation adoption phases and all those in pilot trials.
In addition to expanding a proclaimed bolstered by an engineer.
We will continue to drive commercial execution dangerous Hino sales marketing and support teams.
Fiscal 2019, we doubled our quota carrying sales representatives from 30 to 60.
And we would continue to invest in this team moving forward.
In addition to own team.
Who will extend our global networks with distributors.
That's an important validation of these efforts were working with Perkinelmer to quit Marketo human cool Xome kids, along with their cycle and she is.
Workstation.
And we're already seeing the reserves with new customers coming on board.
So for all products to run we think the work flow of M. shy international sequences.
We shut ins toll mainly in Europe and Asia.
We expect to sign additional distribution agreement worldwide to expand our rich while minimizing our infrastructure.
Moving to verticals for bio pharma in fiscal 2018, with an idea that our silicon based units since its platform could be used to create precision and type with the libraries to accelerate and then drug discovery efforts.
We now have data to support this idea and in fiscal 2020, we expect to leverage these data into partners.
This morning, we announced the expense off of cooperation we spent the therapeutics for the optimization of additional antibodies.
He's come absolutely successfully initial program, where we improved the affinity if you look to immune based specific antibody and I'm a nice species cross reactivity appealed quick preclinical testing.
This is a collaboration that draws on the twist antibody optimization solution to enhance the characteristic of antibodies and a great demonstration affords us, particularly as we can achieve.
Yeah addition.
On a discovery front, we continue to work internally to generate antibody leads using both from a platform.
We previously reported that we had functional antibodies to screechy PCL targets.
I'm pleased to announce that we now have found functional monoclonal antibodies against seven GPCR targets.
These include at the right to a CX yes.
Five and V. two off of cancer.
See RPH, two and again see it exceeds five asthma and inflammation fs itself wind facility and GLP, one off for metabolic disease.
We're running these lease will change through traditional using our platform for partnering discussions.
Moving for Walter will continue to generate robust data to support discussions with potential pharma and biotech partner in fiscal 2020.
Some of our protected collaborations which focus on complimentary technology to drive this drug discovery.
Well those.
Sorry.
Well those would be milestone and royalty driven agreement more traditional traditional of both the companies.
For the latter.
We expect the initial collaborations would be smaller pharmaceutical and biotech companies looking for novel drug discovery.
And we growing value and side overtime as we have additional itself, but the variation.
Turning to that that storage, we continue to reduce the caused an increase the density of DNA that the Suresh to 100 thereafter terabyte.
When the final stages of negotiation for non dilutive funding through a good on the contract on any data storage.
We continue to proceed with the Cmos cheap driver, there isn't which would be design answer because it to be compatible with multiple device design and we'd be a key part of pharmaceutical development path to have some micron feature densities.
Three months into the design phase.
The process, which takes a total of nine to 12 months.
And design truly represents a key milestone to future improvement.
Finally.
With regard with regard to a global strategy, we continue to see growth in all geographies.
We completed a move that can operations R&D incorporate into a larger office seating so someone sees cool.
We've also expanded presence in the EMEA.
And a back.
We can't EMEA alone.
All those Dcs almost equivalent.
Total revenue for the entire company in fiscal 2018.
Well invested in EMEA and if he is paying dividends.
In closing.
An important point in our global operations, regardless of the customer locations around the globe Oh intellectual property to me fixture DNS Silicon will always remain in the United States as well and American company. We May However will finish all products in other locations as we plan to do in China.
For the Chinese customers.
So to expedite the time from auto delivery.
We remain on track to ship office works from a change facility, but enough Canada 29.
At this time.
I'd like to turn the corner to Jim review, our financial results for the quarter.
Okay. Thank you Emily.
As I noted that the fourth quarter was another very strong quarter for us in terms of revenue growth and increased cross margins.
Our annual revenue for 2019.
Was 54.4 million, which exceeded our revised upward guidance of 52 to 53.
This represents another year of triple digit growth for twist as we continue to grow revenue and leverage our fixed costs, our gross margins improved.
And the margin for the year was 7 million positive compared to negative cross margins 6.8 million in the previous fiscal year 2018.
We exited or fiscal year with a very strong operational performance and fourth quarter revenue was 15.7 million a sequential increase a 16% and 87% year on year.
We booked 20 million orders sequential growth of 10%.
To Bill ratio was 1.321 and gross margin for the quarter was positive 21%.
And we ended the year with 138.1 million in cash and short term investments.
Now looking at some of the details of orders in Q and fourth quarter.
Ngs bookings had another good quarter was 8 million.
Thanks for the quarter that was up from 6.8.
Twox or threex.
Received orders for approximately 180 80 ngs customers.
Approximately 40% of those artists from diagnostics terrorist companies, which we touch crisis in health care.
Synthetic biology orders of 12 million Q4 was a 6% sequential increase over Q3 and 43% year over year growth. No. This includes our does a 2.8 million from Kinkle.
Growth was strong across all regions and Q4 reflect our investment in the commercial organizations as Alan noted, we scaled our resources there.
And field fuel sales representatives and total resource on commercial organization, a scaled up from 72, approximately 120, as we've added technical support and customer support.
We also launched a number of new products that are gaining traction in the marketplace. So in summary, overall orders for the year were 17 million, which is 78% year on year growth.
Some of the highlights Harrison by orders, which are defined as genes library is all legal falls, including mentor or almost 42 million and that represents 31% year over year growth our orders for gingko pipe.
1 million as compared to 9 million in fiscal 2018, and that's primarily due to the timing of kinko purchases.
Excluding gingko or send by orders for fiscal 19, or 33.6 million compared to 23.4 million, representing 42% year over year growth and that's primarily due to strong jeans and all of your pools orders in particular from industrial chemicals academic and health care.
And yes orders grew to 28.3 million compared to 6.9 million the same period of 2018.
Representing more than 300% growth year over here and that's primarily from health care.
Really phenomenal growth as we launch that product and February 2018, and the pipeline for larger opportunities continue to scale and we're now tracking 88 larger accounts.
Note that 36 of now adopted that's an additional 10 from our last earnings call. In August we now 52 customers and pilots and validation stages compared to 58 last quarter.
Please note we provide orders not today directly translates into revenue.
More to provide a trend line for each product group.
We also anticipate both ngs and gingko orders to be lumpy quarter to quarter.
Now, let me talk about it.
Revenue in there.
The fourth quarter, we reported 15.7 million and revenue, which is another record quarter.
And 87% urea or year over year growth compared to 8.4 million and quarter Fourtwenty team.
Sequential growth of 16% fourth quarter was really strong quarter for us or send bio products are doing well in quarter. Four revenue was 9.6 million up sequentially from eight.
As you notice from our slide deck.
The quarter four year over year comp with gingko was going to be tough as a Q4 revenue I was 3.2 million in Q4 18.
2.1 million and Q4 19, unless juice the timing of gainful projects.
Consequently, our non-GAAP and core business is growing very strongly and Q4 revenue was 7.5 million up from 5.8 million sequential growth of 27% and year over year growth, 74%. Our jeans business is doing very very well very strong and its remarkable as we moved to a new facility in the fourth.
At quarter end shipped approximately 81000 jeans due to their strong performance of our commercial and ops team and obviously great product from the marketplace.
There are number of products contributing turgeon growth, including outgrowth longer jeans 3.2 in five Kb accounted for 30% approaching revenue and 29 team versus 20% in 20 team our customer base continues to expand driven by our commercial organization our products are e-commerce platform or.
While the 10 pricing.
Our ngs products quarter for.
Or revenue was 6.1 billion would approximate 11% sequential growth and triple digit year over year growth because more customers continued to scale into production, we shipped over to hand over were shipped over 150, ngs customers important before and over 260 ngs customers for the year.
Now, let me pride provide a brief recap her revenue for the year for 2019, I revenue was 54.4 million as a customer shipping preprint crew to an excess of 1300 and that's up from 717 and 20 team.
Our DNA products are impacting industrial processes, helping transform edison and country be contributing to academic research.
Banco revenue for the year was 9.2 million and that was slightly above our guidance of 9 million and ahead of 8.7 million revenue and 20 team.
Were approximately one half year centre for your supply agreement at the agreement is going well and we're thrilled to see the progress drinkers, making as a company and we're excited with her future prospects.
And yes revenue for the year was 21 million, which exceeded our most recent guidance and grew seven axis compare to the 2.7 million in 2018.
Symbio revenue was 33.3 million for the year and that's up from 22.8 million and 2018 and that includes game too. So excluding getting course and bio business is growing very nicely has dropped to 24 million from 14 million.
Strong growth in jeans, and I'll, let go pools.
In terms of regions you asked revenues start to 7 million, that's about two thirds or business.
That's all that's more than double the revenue and 2018 EMEA as family.
As having a great year with revenue of almost 15 million less compared to 6.6 million Mtwenty chain.
Fact revenue for the year was almost 3 million that's about it just under 2 million from China.
In terms of the Keith Keith.
And segments industrial biotech was about 22 million fiscal 19.
Versus 14.9 million health care is now our second largest segment.
And the costs were 17.4 million of revenue.
And.
That is primarily driven by Ngs in jeans.
I'll now to talk with the piano.
So moving down the PML gross margins as we projected we continued to skill rabeeah and leverage our fixed costs, resulting in a positive cross margin of 21% in quarter. Four this brings our gross margin to pause a 7 million for the year.
Operating expense.
Including cost of revenues for the corps fourth quarter or sorry, excluding costs Arabians for fourth quarter increased approximately 34.9 million, which brings our operating expense for the year.
115.8, compared to 63.8 million and 20 team.
R&D increased to 35.7 million and 2019 compared to 20.3 million in fiscal 2018, as we invest in biopharma send bio and Ngs.
SG any increased to 80.1 million and twin Tonineteen compared to 43.5 million 2018, mainly due to increased investments in our commercial organization additional costs associated being a public company and some higher legal fees.
Total loss the years, a 107.7 man and this includes stock based comp real endpoint to enter appreciation of 6.1.
Capex for the year was 15 million major investments and our new writers lab equipment and furniture associated with their move enter a new facility.
Cash and short term investments ended the year 130.1 million.
Now I'll give some guidance for 2020 .
We'll close the ends of our first quarter and we see revenue in the range of 15 to 16 hospital in this quarter no. It doesn't number or less shipping days truth, the impact of customer holidays and were projected operating loss in the range of 30 132 million I.
I just want to make an order orders are very strong this quarter and our guidance for 20 to 23 years in terms of revenue is 80 to 84 million.
Rental revenue is estimated to be approximately 10 million.
Non gainful send by on is estimated to be in the range of 30 to 33 million Ngs is estimated to be in the range of 30 740 million and Biopharma revenue is estimated to be 1 million.
Gross margin.
Average for the years projected to be approximately 32% as we continue to grow revenue and leverage our costs and we expect margin to scale from a card 20% level to approximately 40% as we exit 2020 .
Operating expenses, which include Iron DNS DNA, we approximately 130 million for the year.
Our net loss for the year and expect to be in the range of 103 times and 6 million as we continue to invest in our commercial organization invest an R&D and prepare for the trial Neogen litigation, which is scheduled to begin February 24 2020.
Capex guidance for the here isn't the range element 12 million.
In summary over the last year, we have executed ahead of our plan.
Business is doing extremely well, we're experiencing strong bookings this quarter, we set a high bar and have a disruption platform that helps or customer scale.
And we want to thank all our twisters for another terrific year of innovating executing and a terrific and two quarter for with that I will turn the call back over to Emily. Thank you Jim.
Moving to 2020 from a position of friends, we'll continue to innovate and execute.
Hooks in value, we expect continued revenue growth and diversification as we introduce new products to meet the needs of both extremes on the spectrum of complexity.
Which means the research shows needing high volume high complexity jeans, as well as to which you requirement of gene fragrance.
In addition, who is going to you too and then ecommerce experience.
Cleanse year, we'll continue efforts to move customers through the pipeline from pilot to adoption.
In parallel we expect to introduce new products to meet the needs of those developing nuclear biopsies and cancer research tubes.
We'll also pursue additional applications of our technology within this NIPT micro markets, including deep DTC and I bio.
Well Biopharma, we've continued building proof of concept that that packages for the antibody we've generated through our unique drug discovery platform.
We continue to generate data for twist anti video to musician programs Bowles Hall internal use and fall collaborate to.
Finally, we expect to sign between five and 10 collaborations somewhat some of which would include both milestones and royalties multi be could have protect their ultimate partnerships.
And for that as storage will continue to execute on our roadmap to increase the census is density for silicon platform to use the cause of DNA, writing specific data storage, Indiana.
And I personally.
We'll continue to Cook you saw on increasing our gross margin, reducing turnaround time and expanding our presence globally.
Overall, we are focused on moving up the Betty Chen in all businesses and believed it would be a unique silicon business into this platform that we continue to enable our successful growth.
We see continued opportunities to invest in R&D and commercial team in other to fuel continued medium and long term growth.
On the litigation front face Korea is now closed and we're working to a filing motions for summary, judgment, which will add to quote to dismiss Agence claims.
We speak to file these missions later this month.
We continue to believe the cases meritless, an intent to different else's FICO sleep.
To the extent to cases not results through these motions for summary judgment, we look forward to our being called.
As you can appreciate will not be discussing the litigation acuity. The do encourage you to read updates on the Investor Relations section of the website.
With that let's suppose the call for questions.
Operator.
Thank you.
As a reminder to ask a question you need to press the star one on your telephone.
To withdraw your question. Please press the pound key.
Please stand by we compared to Q and a roster.
And our first question comes from the line of Tyco Peterson with JP Morgan. Your line is now open.
Hi, Thanks. This is all any on for Tyco.
Firstly, you added customers production mode. This quarter versus two last quarter can you talk about what drove the uptick this quarter and how we should think about the quarter to quarter cadence and fiscal year 20.
Yes, I mean, I think if you look at this this is really driven by customers have an internal processes. They've all confirmed that we offer significant competitive advantage. So is there an advantage to national competitors faster.
I know that.
In terms of that pipeline, we've extended the pipeline for meeting for up to 88.
Number of customers. It takes between nine and 18 months to to make sure the pipeline.
As we look forward.
We believe this is going to give a strong man momentum going through this year and into were actually came now into 20 to 21.
And feedback skin in the product reduces superior time is great great reductions on the cost of sequencing.
And.
The the customers are very very happy to to accelerate the product through that pipeline.
Great and then in light of one of your competitors IBP recently rolling out MTS discovery pools and pro at yes. He can you talk about how you're NTS sample prep offering the first and has it been or do you expect it to become more competitive sale process now.
And it's a great questions for think.
When we launched.
Our kids.
Especially in the area of kissed Unplanted sequences.
No we do we had.
A few key features one of them was the speed at which we cool.
Nick custom panel.
And the cost of that first experiment and.
It was not not close its way to the very significant differentiation who is the competition.
So that has been.
Very successful for us has been a.
A key driver of.
Yes.
The become between commercially I think what you're saying is.
He is an attempt to.
Hi response, because those due to feature that greatly appreciate it made a market.
And.
Yes.
Our view, so fives that that.
We still have the faster turnaround time and the best.
Price focused on panels. So why do you want attend.
I think I think it's.
There's a match the liabilities that that al silicon based platform or Phil.
Great. That's helpful. And then just one last one in terms of litigation cost.
Could you talk about your assumptions in terms of the outcome and guidance what the timelines are post this is set and whether the cost.
Of an appeal our included or not in guidance. Thank you.
Yeah, we don't breakout litigation costs.
Hi, right.
The case to know merits and we're going to defend ourselves vigorously.
Our business is doing very well.
Yes customer base continues to grow strongly.
And we're going to position to grow the business and drive cross margins this year.
Great. Thank you.
Thank you.
Our next question comes from on one of Doug Schenkel with Cowen. Your line is now open.
Hey, good afternoon. Thank you for taking my questions maybe just.
Third off.
By talking about.
Recent trends.
Given there are less than three weeks left in the quarter in one of those weeks has Christmas so that that's usually not the most productive weak in the quarter.
First is it fair to say that the risk carrier fiscal Q1 revenue target is pretty low at this point, presumably you have a lot of that revenue in the bag.
And then secondly can you speak to to order trends through the quarter.
You had a very nice closed for the year terms a book to Bill the tone was quite positive at least in my opinion in terms of how you characterize momentum this quarter I'm. Just wondering if you can say a little bit more about how orders how the order book is built throughout the quarter.
Yes.
So thank you Doug.
But.
This quarter.
Building very strongly.
And.
The I mean is an interesting hardware developing the guidance for this quarter in watching that.
You're absolutely right.
With that Christmas and new year in the middle of the week.
Yes.
Given guidance range of 15 to 16, the half million and because the order book is building. So strongly we feel very very good about the educating fourmillion guidance for the year and particularly with the number of Ngs customers a move from.
And now into adoption from the validation stage.
So.
That is severely thinking behind our guidance for this quarter to that does that help it does it does and presumably what you're seeing on the order trend side, recognizing you didn't guide for fiscal Q2, but.
There's there's enough momentum there that would make it feel like if you're you're going to do what you think you're going to be on Q1, if your Garcia normal step up in Q2 that that that's kind of what shape the trajectory of the year or whether it doesn't doesn't feel like based on what you're seeing in terms of revenue and bookings purpose is got to be.
Great was extremely backend loaded year or something like that.
That's right I mean, I think I think it was interesting number of customers grew we're seeing real good strength in Europe .
You know the feedback and Ngs is great send bio.
Had a great quarter I mean, we shipped 80000 genes in quarter four and we moved mean, Doug we moved into new facility.
It's over in color corrupting, we saw more of the longer genes shipped.
Yes, definitely the the platform we've got a disruptive platform.
Super helpful. Okay. So so I was just doing some.
Basic and quick math, so hopefully I'm not messing up anything here, but but if I if I take your quarterly Ngs revenue.
And divided by.
The number of customers you have the revenue per customer is going down now that that makes sense because.
You are growing the customer count pretty rapidly, it's only a fraction of those customers who were in production.
So I don't see anything alarming and that trend I guess, what my question is is ultimately as you move more of those customers into production like we saw this quarter, whether it's a much bigger step up Q O Q3 to Q4 versus Q2 to can you break.
At some point should we see an inflection in revenue per customer as production mix goes up.
Yes, there is a good question Arabian dig into that so so the good news is an increased number of customers that means more customers sampling us.
More customers are so coming in at the front end of the final.
The flip from validation from 26 to 76.
Supports our revenue growth.
Last year revenue was 21, which was slightly hotter than I personally expected.
We thought we'd do about 20 million this last year.
And arranger revenue this years, there to serve and to 40.
And you know I am assuming roughly 50% of that's going to come from those customers that have moved to adoption and we believe those customers are continuing to scale and so what we're now planning for is.
The 2021 revenue growth.
Got it okay.
First thing.
This has been another big year of financing activity across and bio identical a lot of us have seen data that supports that assertion thoroughly for those of US who attended send bio beta with it's apparent that it's a growing field.
A lot of interest from.
Both.
Users as well as the investment community. If we think about the amount of money that's gone in self funding growth for existing companies and.
The creation of new send bio company I'm, just just wondering obviously, it's a positive trend for you, but how do you weigh that in the equation that he set guidance for this year.
I think I think it's I mean, it's interesting because we if you look at many of you go back even VC funding backend.
2018, and I mean, I guess through this year as being very strong what does that mean, there's more applications more or market opportunity and we have a platform that allows our customers to scale.
And I and you just look at a number of customers we ended up with over 1300 customers and others.
I think there's huge group room for us to grow and partly moving into this new facility.
We are positioning ourselves for another year has as the guidance highlights E 84 million and carriers strong growth and were no sorry, sharpen our pencils on what's going to happen and 2021.
And the Biopharmas going well.
So it's all all of its leverage offer platforms. He stepped back we have a platform that provides great product has got a layer customers to scale. So you know it's is we're going to just keep their food to Florida and keep on the gas here.
Yes, it that all makes sense I mean part part of the reason I ask that probably sounds like a really obvious question, but it's just when I do again, some quick math and just try to.
Measure basically just just to analyze revenue on a per customer basis.
It does even though your guidance is above what I think a lot of folks were looking for I think one might be able to argue that there there could be a bias to the upside when you think about the funding environment and you look at your guidance, which doesn't seem to across the board.
Factor in an assumption that this growing group of customers, who is increasingly better funded its got it's got Iowa.
Got to spend a lot more on product, but practically speaking you would think they what so I'm not sure. There's a question. There. It's just kind of an observation that it doesn't seem like your guidance is assuming that this growing group of customers is going to spend a ton more on your products are five of the fact that practically speaking they kind of need to and they have the money to do so.
Last question, how meaningful has the of G.I.P.G.I. partnership impacted revenue growth in China.
Yeah, we just signed it.
A few few weeks ago. So I think we look too early.
It's too early but the figure if it.
Important catalyst for next year growth.
You know, where we're excited about it and though we will need to be the first the first.
Thank you sequencing kid on the on the platform and.
Led that.
We achieved that goal.
Okay, all right Thats, great. Thanks for all the airtime I appreciate the color.
Yes, Doug.
Thank you and our next question comes from Alon Luke's.
Evercore Your line is now okay.
Great Hi, guys doing.
I guess, just a follow up on that Mg.
Question from Doug.
Any discussion with Illumina right now to do the partnership with them is to help keep the overall sequencing costa.
I don't think is any discussion I can I can comment briefly on I think we well always looking too.
As we mentioned.
Who is working too.
And then.
Each through.
Plus Vito and partnerships.
No we have to publicly announced squeeze.
Perkinelmer on EMG, but.
I think we have a great product and.
And we're looking to.
And then sit with.
Partnership with different channels.
Okay, that's a tough I got it.
And then your growth on this in bio X gingko revenue has been.
Quite strong.
First is our model.
Can you talk about how much of that is from new customers and then also just from versus.
Extra wallet share versus existing customers.
Okay.
So so interesting question. So it's a combination of bought this new customers and we're getting extra wallet share.
Particularly Iran. As a means interest and some of the customers come on the ramp faster than we expected.
And.
Those are new customers or.
Q1 calendar I guess.
I think his boss.
In the platform is allowing us scale.
Offer.
Very competitive pricing.
And there are seeing terrific service.
As a combination of of the overall.
Hi to commercial organization or E Commerce platform.
We continue to see opportunities growing particularly in Europe .
Her person vial as well.
The good thing as we go back in time, and we can get because a great customer for US again 'cause shares is now down or roughly 717% of our total company or 16% and we are seeing more and more customers either does I mean, we're over what 1300 customers.
So no cost thousands and bio customers.
And he.
He is a longer genes continues to grow as well.
We launched five Kb earlier, this year and we're seeing really good feedback from marketplace.
Okay, that's helpful and.
And then lastly, I guess on the bio pharma funnel can you talk about the order trends from where you are seeing how that funnel looks versus.
On the antibody optimization versus the drug discovery.
So to give it the bio pharma vertical right yeah.
Yes, yes, so so.
As the Cookie note the discount to offerings that we have one is a drug discovery.
Finally, with someone comes with Dell target than we can you can give them functional antibodies and then the second is an optimization.
Solution, where someone comes in with an already discovered antibody and we can.
Turning to a better antibodies, so whichever drug like properties that are interested in could be cross reactivity could be affinity.
Could be or those.
So.
Now we have that affable and that was.
The focus of this year was to demonstrate that both ways.
Prosieben and.
In the funnel.
We.
We are pushing opportunities for both.
I think.
We should see.
Partnerships or corporations.
I noticed in both Syria.
Okay. That's helpful. Thank you.
Right. Thank you look.
Yes.
Thank you and one last question comes from the line of Catherine short with Baird. Your line is open.
Hey, guys congrats on the quarter and thanks for the question.
First on the millionaire bio pharma revenue and your fiscal 20 guide is that only from already signed agreements or does it didn't seem some success signing those.
The type deal.
Oh.
Tom.
Yes.
From.
We announced Pandya.
It's from some of the deals we signed and.
That.
We are seeing.
As highlighted on the call. We're seeing good opportunities are coming down the final final and we're getting more line of sight on the revenue and that's why we're highlighting a million.
Revenue.
At some length from Biopharma.
And to complement that we next year, we as we announced were looking to sign.
Deals that will include.
Milestone payments and royalties, but the.
Revenue that we guided is only for the upfront portion of those bids.
Got it okay.
Then going back.
Any qualitative comments.
So far and what are you assuming for contribution from that partnership in your 30 740 million and yes go ahead.
Yes.
Nyquil.
I think we.
We.
I'm planning to.
Hello, Kate.
The growth.
This point on on different sequencing platform.
Although we do we do see it as a.
As a good catalyst for growth, especially in Asia and China.
Okay, and then last one for me going back to Doug's question.
Cadence is particularly for that Ngs.
I expect lot of growth there. This year as you look at your pipeline of customers and pilot and validation stage. It are there any large customers you're expecting to move into production in the coming quarter to worth calling out we're just trying to get a better sense of revenue cadence throughout the year for Ngls.
Yes, good question.
I mean, there was the orders tend to be tend to be lumpy.
And the good the good news is the.
The broadening out of the number of customers are adopted.
And we're starting to feel as if we're.
We've shown revenue growth every quarter.
I think in quarter two this last year, we had one large large order.
Which which did which was great.
And we have not built into our forecast this year to have some are sort of large order says more abroad.
Customer adoption smaller revenue assumption by for each customer, which gives us more confidence.
In terms of our 37 to 40 million dollar revenue.
Okay, great. Thank you.
Okay.
Thank you and this concludes today's question and answer session I would now like to turn the call back to approach for any further March.
Thank you Chris.
So we're very pleased with the exception the girls we have demonstrated.
Quarterly revenue curve, but as soon our ability to take an idea and drive it into a product.
We began in bio we've added Ngs and we are making good progress both in Biopharma and ended the storage.
So we look forward to sharing or progress with you in fiscal 2020, and I'm very confident that it would be a great deal. Thank you very much.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.