Cytek Biosciences Inc. Q1 2023 Earnings Call
Okay.
Good afternoon, and thank you for standing by and welcome to the <unk> Biosciences first quarter 2023 earnings Conference call.
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I would now like to hand, the conference over to your Speaker today, Paul Goodson head of Investor Relations.
Paul Please go ahead.
Thank you operator earlier.
Earlier today <unk> Biosciences released financial results for the quarter ended March 31 2023.
If you haven't received this news release or if you'd like to be added to the Companys distribution list. Please send an email to investors at site Tech bio dot com.
Joining me today from sidekick, <unk>, Zhang CEO and Patrick Germano CFO .
Before we begin I'd like to remind you that management will make statements. During this call that are forward looking statements within the meaning of the federal securities laws, including statements regarding <unk> business plans strategies opportunities and financial projections. These.
These statements are based on the company's current expectations and inherently involve significant risks and uncertainties that could cause actual results or events to materially differ from those anticipated.
Additional information regarding these risks and uncertainties appears in the section entitled forward looking statements in the press release Sci-tech issued today and in <unk> filings with the SEC.
This call will also include a discussion of certain financial measures that are not calculated in accordance with generally accepted accounting principles.
Conciliation to the most directly comparable GAAP financial measure maybe found in today's earnings release submitted to the SEC.
Except as required by law.
<unk> disclaims any duty to update any forward looking statements, whether because of new information future events or changes in its expectations.
This conference call contains time sensitive information and is accurate only as of live broadcast may nine 2023.
With that I would like to turn the call over to rent them.
Thanks, Paul.
Welcome everyone, joining our first quarter earnings call.
Thanks Carl.
On the call today.
I'll discuss our progress during the first quarter.
Including some headway.
Headwinds impacting our top line results as.
Well as our progress across our four key strategic pillars to drive growth.
Then I will turn the call over to Patrick.
A more detailed look at our financial results.
An update on our outlook for 2023 before we open it up for Q&A.
Starting with our first quarter results.
We achieved $37 1 million of total revenue.
Representing growth of 6% year over year.
This included approximately $3 4 million of revenue from that product line acquired Numerex.
Excluding acquisition related revenue.
Net revenue accounted for $33 7 million.
While we saw strong growth in Europe and APAC.
Notable growth in China.
Face increasing pressures with our biotech pharma customer base in the U S throughout the quarter.
Particularly at the end of the quarter.
Among the factors affecting demand in the quarter.
Mark slowdown in biotech funding.
Give us a banking among biotech and pharma companies.
The decline in Covid demand and macroeconomic uncertainties.
Our team in longer sales cycles and delayed orders.
Patrick will provide more detail.
Financial results shortly.
Based on our Q1 results.
As well as these headwinds.
Now expect full year revenue in the range of $205 million to $217 million representing growth of 25% to 34% over the prior year.
While our top line growth this year will be slower than our previous expectations.
We firmly believe the underlying demand for our full spectrum profiling Paul.
<unk> platform remains strong.
We remain committed to driving growth and diversifying our revenue streams to continue our strong overall performance.
We are taking proactive measures in this transition year to optimize our business operations in 2023.
We integrate the newly acquired business, while eliminates with ongoing efforts to further our overall strategy.
At <unk>, we take pride in our distinctive position in the industry.
As we offer our customers a comprehensive end to end solution that includes instruments reagents software and application offerings.
Our recent acquisition and the partnerships have further strengthened our portfolio.
Allowing us to further stand apart in the field.
Our comprehensive suite of products and services have continued to advance adoption of sighted full spectrum profiling platform as the method of choice for cell analysis.
Our core suite of instruments continues to see solid demand in part because that is a large market of conventional flow cytometry is waiting to be converted to our SSP technology.
Whether its ultra high sensitivity immediate.
More challenging tail corporations or easy of use intuitive workflow it out for more routine analysis.
<unk> portfolio is.
<unk> uniquely positioned to meet the needs of both cell analysis, regardless of assay complexity.
In addition.
Our expanding portfolio of panels optimized for use our instruments will continue to advance.
Adoption.
And our recent acquisition of the flow cytometry and imaging business funnel eliminates will open new markets and applications.
As I have discussed before we operate our business. According to four key pillars.
Each of which is integral to our long term growth.
These pillars.
Our instruments applications bioinformatics and the clinical lay out our roadmap for operating our business now and in the future.
Intentional and purposeful execution.
Despite the challenges we faced in the first quarter.
I remain confident that our daily work.
Lines under these four pillars.
Our overall strategy and will produce excellent growth over the longer term.
Starting with instruments.
During this quarter, we placed 96 cycle of instruments.
Altogether.
As the installed base has now reached 1766 instruments.
The first quarter of 2023.
These statements reflect our cost strategy to achieve growth across a range of applications and users.
From entry level to high imagine of cell analysis applications.
This number does not include the installed instruments of avnet and across our product lines, we acquired <unk>.
Which at an installed base of more than 7000 instruments across more than 500 customers in over 70 countries.
Over the longer term, we believe this installed base will eventually benefit from replacement and upgrade into our northern lights and Aurora platform.
We also believe this expanded installed base will provide <unk> with a receptive market for new instruments.
Intend to launch in future years.
<unk> advanced technologies.
The mandate by the powerful technologies, we have acquired from <unk>.
The applications area includes our reagents and kits.
Here, we are absolutely collaboration with our partners to <unk>.
Span our agency portfolio.
And develop application specific tests.
And we are making progress in both areas.
Revenue from new agents in our case continues to be our fastest product growth areas, highlighting the increasing demand for our offerings, which folks are.
Making the scientists and clinicians shop easier faster and more accurate.
We are strategically investing in opportunities to grow.
As exemplified by our strategic partnership with our Rad laboratories to expand our reach and portfolios and enhance high parameter panel.
Our cell analysis systems.
The addition of bio Rad stop right is our <unk> platform.
Which we announced during the first quarter, providing a major advantage for researchers conducting multi parameter experiments.
And we are excited about this ongoing partnership with.
We also recently launched our 'twenty.
Myeloid leukemia, AML panel and effective and sensitive flow cytometry approach for identifying and characterizing novel and a balanced sales.
Phenotyping.
Anything measurable residual disease or <unk> in AML samples.
This new kind of unleashed the power of our SSP technology.
And a year filled with all the companys extensive experience.
Nearing resolution lighting through special flow cytometry to offer a more comprehensive understanding of the human immune system.
Parametric flow cytometry assays are widely used in the testing and monitoring AML in drug discovery.
Translational research clinical trials and clinical diagnostics.
Historically.
Conventional flow Cytometer.
Marcos used for assessing AML typically split into multiple tools due to the limitation of detection channels.
Forcing the use of Duncan markers and the greater sample volume.
Placebo to <unk> for AML increases sensitivity, while ending this wasteful practice.
Enhancing laboratory operational efficiency.
Saving time and labor for sample acquisition and the preparation.
As well as preserving precious samples and eliminating the use of the downturn to the agents.
By providing total solutions for specific application areas, such as R&D, we're giving researchers and scientists new leverage to jumpstart their discoveries.
<unk> advanced.
<unk> of life saving therapies.
Informatics is our third strategic area.
A key part of our bioinformatics strategy is enabling our customers to streamline their experiment workflow.
Our <unk> cloud product allows customers to design panels faster with a suite of full spectrum panel and tools and the ability to share panels.
The other side of our customers.
In addition customers can convert the panels into expand until templates that can be used on any cycle instrument with special for all software.
We believe providing these benefits to our users increases the attractiveness of our cell analysis solutions.
Drive demand and create loyalty among our users.
Our site the crowd the products launched late last year was very rapidly adopted by many of our customers and continues to receive growing customer interest.
Turning now to clinical opportunity.
Several of our products approved for clinical use in both China and the European Union, where our most common sale for critical applications is the northern lights CLC system, accompanied by our CFO reagents.
As a reminder, we plan to submit our products for FDA clearance in the U S.
We believe our powerful SSP platform.
<unk> will bring enhanced diagnostic PA and the visibility to the benefit of patients by giving doctors are clearly in a more detailed review of.
Each patient's condition.
As in China in the yields.
We believe the U S clinical market also represents an attractive long term business opportunity for us eyetech.
Globally, our approach to the critical and a laboratory developed test.
The LPG market is being driven by customer recognition that our technology enables critical labs.
Fishing to perform high level multi parameter immuno phenotyping.
Small amounts of patient samples to.
Identify new cell subtypes, and the disease pathways.
This approach provides the doctor with more refined and a detailed insights into their patients' conditions.
And the first clinical samples often difficult to obtain and the limited amount.
The ability of our system.
Complete results.
Only one sample processed in a single tube with important to patients doctors and the lapse rates alike.
Very concrete away our plan to have our technology adopted in the clinical market is expected to mirror. The success. We had beginning 60 years ago. When we revolutionized the research market with full spectrum technology.
Our full spectrum technology was rapidly recognized as the gold standard for research use.
And we plan to establish it as the standard bearer for clinical applications.
Future.
These benefits become better known in the clinical community in China and Europe .
We believe our platform will have accelerated acceptance.
Standard advanced which is a clinical diagnostic approaches.
Given the comments of one of our European clinical customers.
Any indication of our success in this area, we are making great progress here.
We can better define novels by being able to use more markers in a single tube.
Maintaining full correlation between all parts of it.
Beyond the instruments, our kit and the regions are also gaining importance in clinical applications.
There's something called a panel for AML I mentioned, a few minutes ago is a powerful new product for supporting diagnostic study.
Clinical evaluations and the patient stratification. In addition to being used as a research tool for the development of new drugs.
And we expect it will have strong uptake.
All of us at Sci-tech gratified that we are making important contributions to the practice of critical research and medicine.
This is part of our mission that drives us to manufacture high performing products and to develop new technologies.
It will enhance the lives of the patients and doctors who depend on our contributions.
Was that entirely due to the publications that include our technology. We are pleased to report that building. This quarter alone. There were 145 peer reviewed publications mentioning cycle.
Bringing the all time number of publications to 1152.
This is a remarkable achievement speaks to the momentum of our platform and validates the importance of our offerings to the scientific community.
We remain committed to advancing scientific research.
Our innovative products.
As an example of how significant some of these research efforts.
In one paper published in nature.
Researchers at the film credit intensive Institute.
<unk> as therapeutic strategy for starting metastatic cancer relapse.
And the second nature publication published two longevity.
Scientists discovered conditions in which T cell reputation does not stock up to assess a number of divisions.
Suggesting research direction for extending human lifespan.
Another paper was recently accepted into the clinical section of the journal cytometry.
Which used three laser FTE instrument.
31 color panel and the lead Infosys, what we have been reporting to you about the importance of full spectrum profiling in immunology and the running samples in only one chip.
The abstract of this paper states.
New monitoring of patients on a single cell level is becoming increasingly important in various diseases.
Due to the awesome very limited availability of human specimens and our increased understanding of the immune system.
There is an increasing demand to annualize as many markets as possible simultaneously in one panel.
Two special flow cytometry.
Emerging as a powerful tool for immune monitoring.
Finally, I would like to spend a moment to discuss our progress.
The integration of luminous flow cytometry and imaging businesses.
As we have shared.
There are numerous flow cytometry and imaging business provides important contributions to our technology capabilities.
Range customer base and our commercial reach.
Although we are now only a little more than two months into the integration process and still have some key steps ahead of us.
<unk> completed several important milestones already.
From a commercial perspective.
You have cross trained all of our commercial personnel the technologists due to that.
Got it.
And the guava product, who sci-tech employees.
The sidekick products for our new team members found index.
These programs include all sales technical application specialists and the service personnel and provide lessons on each other marketing programs product demonstrations customer training and other areas.
In addition tool cross training, we launched a cross selling plan targeted at FSP and mix and a guava product.
The integration of our service teams will take a bit longer due to the technical training required.
But we haven't established a target date in the third quarter for the completion of that integration.
And operations perspective, we.
We're making good progress on business system integration.
Factoring transition and the product harmonization.
Over the immediate term we have set three milestones regarding the acquisition.
The first milestone is focused on accelerating sales of Avonex products.
Both of our coaching cycle corporate average sales growth rate.
By penetrating into the existing customer base.
This includes targeting half of the 1000 Aurora customers, who purchased at least one unit over the next three to five years potentially generating approximately $200 million in additional revenue.
The second milestone is evaluating <unk> cost structure within the next six months to determine future product development plans, whereby some micro capillary technology.
Attractive asset and its potential integration with the northern ice platform could provide access to a new untapped customer base.
Great site that aims to convert existing three reservoir of our users through the northern lights platform as part of the strategic integration goes for Comdata continuously.
Look forward to updating you on our part.
Yes.
While we expect modest revenue contributions from the acquisition this year.
A reminder, we think that the real value of this.
Acquisition will be realized in the longer term in three primary areas.
Most importantly, there are a number of new products, we will introduce that represent a combination of the technologies available on each platform.
There are significant cross selling opportunities we will leverage.
We integrated our sales teams.
And finally, we expect a significant improvement in the efficiency and the gross margin of our service organization.
Addition of our new highly trained and experienced team members found in minutes.
Once again I'm pleased with the progress our team has made this quarter as we navigated some challenges on the macro front.
We remain focused on providing a complete cell analysis solution to our customers.
We look forward to continuing to provide our novel SP platform complemented by numerous products and technologies to these customers.
They pushed the bounds of scientific discovery and clinical progress.
I will now turn the call over to Patrick for more details around our financials.
Thanks <unk> bin.
Total revenue for the first quarter of 2023 was $37 1 million.
A 6% increase over the first quarter of 2022.
As Wendy mentioned.
Included approximately $3 4 million of revenue from the products and services acquired from Illumina X Corporation.
As a reminder.
The agreement closed on February 28th, meaning we've got we recognized four weeks of revenue from these product lines in the first quarter.
Organic revenue, excluding the acquired products and services.
$33 7 million.
A decline of 4% compared to the same period of 2022.
Keep in mind that our 2022 revenue was particularly strong.
Hosting 44% growth over the prior year and setting a high bar to achieve growth this year.
Our organic revenue was impacted by a few key factors.
The slowdown was driven by longer sales cycle and delayed ordering from our biotech and pharma customers, which we believe was due to increased conservatism arising from macro uncertainties in the funding environment.
A decline in bio processing activity.
Higher interest rates and other factors.
The slowdown in the U S was offset partially by better performance in all of our markets outside the U S.
A number of our ex U S markets grew in the high double digit with China growing in the triple digits as a percentage of revenue.
We are pleased with the significant improvement in gross margin in our services business.
And revenue from our academic customers grew in line with our expectations during the quarter.
On a constant currency basis for the quarter revenue was $38 1 million an increase of 9% over the first quarter of 2022.
Gross profit was $21 million for the first quarter of 2023.
An increase of 4% compared to a gross profit of $22 million in the first quarter of 2022.
Gross profit margin was 57% in the first quarter of 2023.
258% in the first quarter of 2022.
Adjusted gross profit margin in the first quarter of 2023 was 59% compared to 60% in the first quarter of 2022 after adjusting for stock based compensation expense.
And amortization of acquisition related intangibles.
Operating expenses were $33 2 million for the first quarter of 2023.
47% increase from $22 5 million in the first quarter of 2022.
The increase was primarily due to expenses to support continued growth of the business.
Including further investment in R&D.
Quarter of 2022.
Net loss in the first quarter of 23 was $6.8 million compared to a loss of $2 $2 million in the first quarter of 2022.
Additionally, adjusted EBITDA in the first quarter of 2023 was negative $2.5 million compared to positive $1.9 million in the first quarter of 2022 after adjusting for a stock based compensation expense.
Cash cash equivalents and short term investments were $299 million as of March 31, 2023.
Now turning to our guidance for 2023.
As wind been shed our expectation for the 48 2023 revenue to I'll fall into a range of 205, two 220 million.
Representing overall growth of 25% to 34% over 40 years 2022.
This is comprised of revenue from our organ business in the range of 180 million 290 million representing growth of approximately 10% to 16% over the full year 2022 revenue.
And a total of 25% to $30 million of revenue contribution in 2023 from the business acquired from Luminex.
This assumes no changes in the rate of foreign exchange as well as some continued delays in order.
Longer sales cycle from biotech and pharma customers in the U S as when being mentioned.
While our typical seasonal pattern is for revenue to be skewed towards the back half of the year.
2023, we are expecting that pattern to be even more strongly upfront due to the effects of integrating amnesty and guava as well as macro factors affecting the U S economy.
With that I will turn it back.
Over to <unk>.
Thanks Paychecks.
As always I wanted to start by thanking our team at Sci-tech for their dedication and drive fast.
Attitude on our mission to deliver our complete sale, a nicer solutions to a broad range of customers.
It is their accidents, how to work and to share that belief in our in pleasant mission that drives our progress.
Sci-tech is in a fortunate position with many opportunities.
We are in a strong position financially.
Continuing to see sort of demand.
And committed to remaining profitable an annual editor and a net income basis.
As well as achieving our long term growth targets and objectives.
In addition.
Our solid the balance sheet underpinnings, the strength of our company and provides important to you the flexibility to take advantage of opportunities as they may arise.
We have significant opportunities ahead to convert the large existing base of conventional flow cytometer to full spectrum.
To expand our products into clinical use in the U S.
Accelerate the growth of our steel new sales order.
To create new products from our recent combination with ominous and the guava.
To drive sales through and expanded our customer base.
And to make our overall company more efficient and profitable as we scale in size and the product offerings.
We believe Sci-tech is a particularly well positioned to address these opportunities.
Given that all of our advanced technologies, the strength of our capital base.
The growing awareness of Sci-tech among customers in the marketplace.
And the extraordinary talent of our employees.
I want to thank everyone for joining today's call and we will now open it up for questions.
Operator.
Thank you Dr. John .
Yes at this time will conduct a question and answer session. As a reminder to ask question you'll need to press star one one on your telephone and wait for your name to be announced to withdraw your question simply press Star one one again.
Please stand by while we compile the Q&A roster.
And our first question comes from David Western Bird with Piper Sandler David Your line is open. Please go ahead.
Hi, Thank you very much for taking the questions and I'm going to squeeze in a few here because I think a lot of people on a lot of difficult Tonight.
Anyway can I, just maybe ask about the the placement numbers here.
Your placement numbers missed me by more than the implied revenue b.
Are you at least hitting maybe traction with with the Aurora placements and can we make any kind of in France in terms of like what the the.
Tangential for selling more reagent to that customer in 2023, and 2024 and beyond and I I have a few more here.
So maybe I can take the first question, Dave Thanks for asking so looking at the instruments.
Placement, so we sold 96 last quarter past two.
116, so we are down on almost all the categories.
But at the same time, we've seen to your point.
Click in an increase in.
Reagent revenue so the increasing revenue coming from reaching is actually very positive.
Okay. Let me let me ask you a few more here can you talk about maybe the penetration rate of false pacto flow Cytometer is.
Here I mean, I I think they are you know as you've known that there is a slowdown in placements I mean, I still think that you have the best in class technology here, but.
But maybe are we getting in your opinion, maybe a little bit more mature market are we getting an air pocket in terms or is this moral been an air pocket and.
In terms of market conditions.
And I'll ask a couple more.
I think we can.
Take a look at the.
Spread of our customer base.
That includes academics and.
<unk>.
Also international.
I think as indicated our international sales have.
Very well and.
Especially in China and.
Actually the market leaning more toward our high end of the Aurora and a sales orders.
The U S.
As expected doing okay, and I think.
Meet our expectations politically.
It is a former biotech that's below our expectation.
It doesn't mean that businesses loss. It just takes longer time for them to come back to a pace others they become more conservative.
And Ah.
Sighted.
Cause of our business right as they are heavily leaned toward.
Well actually kind of spread amongst kind of behavior for each quarter.
This quarter, particularly.
Cause of the situation, we all know about and.
So really the third among has failed.
Failure to meet our expectation with those.
Commercial customers farmer in the biotech as they become more conservative.
So that's basically what what's happening right now.
Got it maybe I don't know I'd like to dwell into that cause I I don't think that the entire concept that biotech small biotech danaher her set it on their call that there. There you can rationalize spending we all know that they can't get kind of funding that.
They want here.
From from closed.
Capital M.
Capital structure.
Capital markets that environment, sorry takes a while to get it on.
But you know.
I I think you ash pharma based customers as is.
When does that agreement quarter of the customers is there any chance that maybe some of the other customers and you know as we go into further into the year can kind of make up for some of that slack here I mean academic is not necessarily as dependent on the cycles.
As we see the back half of the year.
Is there upside for maybe maybe they don't need to cut out that spending considering biotech.
Still need to spend on their R&D projects for a later stage programs.
And any color there would be helpful.
Exactly what you'll have indicated.
It it just takes longer for them to come back or was order a non-resident means.
They will never come back and indeed, and we have seen this already under as we got into the acute too so.
Basically what we will put it over there like this.
Okay actually you know what I'll I'll hop off right now and then I'll hop back in and ask a few more things.
Stand by for.
Our next caller.
And our next question comes from Chaos Savate from Morgan Stanley .
Your your line is open. Please go ahead.
Hey, guys. This is Edmund amputations. Thank you for taking my questions I just wanted to dig a little deeper than what you are seeing in terms of the former biotech headwinds in the U S in the quarter.
Is there any sort of bifurcation between some of the Smith capo farmers here versus something larger biopharma biopharma in Burma companies.
And are your expectations for I know you are saying that the orders are gonna take a little longer but are they gonna be will this trend be normalized by the year or it is something that may.
Leave a little longer to 24.
Indeed actually there are some.
Difference between the larger farmer and.
The small farm biotech.
Based on the data we have analyzed in fact a small.
Biotech has a kind of steady coming down over the last few others, but the big pharma actually has a southern rapid effect, which is impacting what we're seeing right now but on the other hand.
We don't think the business is lost and it will still come back once the situations stabilizers as I said mentioned earlier and we are already seeing this <unk>.
<unk> right now, but it's going to take a longer time to.
To close this year than what we normally see.
Got it.
And then Patrick I think you mentioned, a a steeper second half skew I was wondering if you could put that into <unk>.
Both sets you require expectations I believe it is about 40 to 57 per year.
Yeah, so with that statement, but I think we're going to be closer to 40, 60% 6100 40 60. So.
More skewed towards the second half of to your point.
Normal lives.
And screaming also the economy doesn't.
<unk> I think the expectation at this point yeah.
Got it great and then just touching real quick on your billing hold arrangements.
And it turns out you can see are the elevated levels still elevated in this quarter or has a normalized more normalised level can you comment on the level of Illinois.
Yeah, we still have a as I mentioned last year.
We'll continue to have some billing hold I think this is a part of the.
The business process.
The expectation is that maybe going forward all come down a little bit better you'll feel.
In Q1 of this year.
Oh, roughly what percentage of the revenue.
We have about a little less than $6 million in billing hold over the.
Revenue number.
Got it.
And then turning to your Sci acquisition and.
And this platform I was just wondering what are some of the strategies you have in place to drive. This commission is converging and what has the initial feedback and and then looking more specific we I'm trying to understand how these two platforms will work together in the research for a quote is idea here researchers can.
Others FSP platform too.
Quickly narrow down to a smaller subset of cell populations of interest and then performed downstream analyses on that and this with imaging capabilities.
Yeah and in fact, I think there's an overlap lap.
Here is more related to the farmer call lap.
Early during the early discovery stage Sheila and.
We can provide some additional information regarding tool.
Sales and also the inside of the sale to sail interaction and insert a sales.
Those are the actual inflammation.
Which typically phenotyping won't be able to provide this is where we see opportunities.
Especially with regarding our five later on all our customers and Ah, mostly heavier a cluster towards that type of applications and feels I'm next will add on top of what we have provided to help our customers are Lisa to understand and more of the Ah Ah.
Discoveries engaging was.
Got it thank you.
Stand by for our next question.
And our next question comes from Matt Sykes at Goldman Sachs, Matt and your line is open. Please go ahead.
Hi, This is easy cause loss counterman, thanks for taking my questions.
Just wanted to ask what staked into your guide and the bass fishing nets for the rest of the year in terms of biotech funding and and shrink men and like more specifically how much of the back half recovery is from synergies with the acquisition versus a macro recovery.
Yeah. So the back half obviously, the most of the recovery is going to be.
Actually it's gonna be twofold, it's gonna be.
Along with the.
Added that guava, an amnesty products.
It's gonna be so much stronger activity on there on the.
Academic side, and obviously also the expectation that the euro biotech farmer comes back on the trend in pools and the next coming months and we've already seen some early signals for that.
So we hope for <unk>.
The the second half of this you will actually provide us.
With the increased.
Revenue that we expect.
Yeah, just to add on top of that right now our sales finally still very very strong very powerful.
We feel.
Take longer time to close but eventually it will come.
Okay, Great. Yeah, that's really helpful. And then you kind of touched on that but what is your insurance backlog look like what are their names in our coverage sighting lashes ability in recent corners.
What kind of visibility do you have on your orders for the rest of the year.
So we don't really breakout backlog information although.
<unk>, which is mentioned we have a frontal which is the open odor level activity and.
We track that funnel.
Daily weekly basis, and are fun as compared to last year. So we have a fairly good understanding of what's what's coming ahead of us yet we have.
Less.
We don't understand why we don't know is how fast customer will turn.
An order into appeal.
Okay, great. Thank you that's it for me.
Thank you very much and stand by.
Our next question comes from Steven MA with TD Cowan Steven Your line is open. Please go ahead.
Alright, great. Thanks for taking the questions [noise].
Ground already covered so I'll just have a few.
Different questions.
So on the on the Luminex revenue it looks like you've you've raised the guide from from used to be $20 million I think.
Four 2023 to $25 million to $30 million.
So where you're seeing similar macro headwinds on the amnesty flow Cytometer platform I'm, just trying to square away the difference between.
Lowering your you know your your your organic guide and then raising the Luminex guide.
Yeah, and particularly in the during the last two months as we continue with this integration we start to understand more of the.
Products when we first provided our early guidance we.
Ah kind of optimistic with regarding to.
Converting guar customers into our northern light.
Platform, but now we realize fibre has some special features which actually has been to take longer time for northern lights to increments that means that part of the business is not going to convert that quickly it will happen, but it's going to take a longer time because of this we have lowered the organic.
It was a business forecasts, but in the meantime.
We have kept a certain.
Business was.
Minutes, where should we originally intended to terminate and now we are going to continue.
That was part of the reason why the luminous business.
Forecasts has gone up.
Okay, alright that makes sense and.
When do you think the integration and tech transfer will be completed for the guava microfluidics too to northern lights.
I think basically is.
We are not going to spend the next six months to understand more of the guava understanding of features which understand their customers needs for those rather than make a decision how we are going to.
Adapt adopt set of features and integrate.
Integrate those type of feature into northern lights. So we can support local how about customers.
With the northern lights platform.
Okay great.
And then I'm moving on.
To your <unk> partnership using their star right dies.
Do you have any timing on when that that product is going to launch and and if you're able to disclose how does how does the revenue share work with bio Rad or are you just using the Barbara reagents is sort of like a OEM type of arrangement.
The process here, we qualify and then integrate that Paradise into Sci-tech portfolio. In fact, they are going to be sold as sighted C for Ah Ah the agents so in that process, Vanessa certain work that needs to be done internally from.
Operation side, but it's happening, but you will we should start to see the hours.
Come with us during the second half of the year.
Okay got it and then I'll sneak in our last one of her Patrick.
Patrick yet yet a lot of questions on on the on the U S and pharma and biotech softness and you know you mentioned the heavy back and cadence, but you did mentioned that there was a couple of points or trends that you're already saying I'm. Just wondering if you can.
Provide us hose any colors on some of these things, which are giving you confidence on on a strong back half of 2023.
Yeah. So so the couple of trends that we're seeing is first to be.
Funneled activity remains fairly strong. So we are very pleased with that.
Across all the regions, most notably in the U S. So that's very positive.
So that's.
A key element and.
That's going to support the the second half.
Okay. Thank you.
And standby for our last question.
And that comes from David Westerberg again from Piper Sandler.
David Your line is open.
Hi, Thank you for taking the thoughts I just want to confirm in terms of competitors and and false backdoor flow cytometer.
There's really not still any any form it'll competitors and I just want to confirm that and then you know are you seeing anything in you know in terms of Patton's are announced products that you would consider.
More of a threat.
Oh, that's a question.
[laughter] and the first is I think as we all know a full special profiling technology has already become that go to standard of the industry and we <unk> I think.
Nobody is questioning that the future is not going to be special based photo cytometry.
Sci-tech is.
In this technology and I'm sure today and many other companies are working towards this and very likely they are going to have product coming around but in the meantime, sci-tech as a leader we are continuing to invest to make sure. We stay ahead keep our leadership.
Positions.
So we are very comfortable we are very.
Confident and does that we will continue to be the leader and for the years to come.
Gotcha, Okay, and then you know I'm kind of a follow up to my my my my previous question here and just I know you don't give longterm growth guidance and you know just goes back to whether or not this is an air pocket or a P. C. You know maybe maybe you hit some certain sort of penetration rate in the flow cytometer market, but you know I I.
As we look at <unk>.
2024, 2025 2020 <unk>.
I mean I'm guessing this is.
Definitely a double digit grower, but I mean any thoughts in terms of.
Growth rates.
In and out years compared to what we've seen you know the guidance this year organically and you know what we've seen historically.
Are we are we are we still that 30 per cent garage.
[laughter] put it this way okay as the company continues.
A place that's become larger.
And it's going to.
Percentage of white.
The smaller but the absolute number is going to be still very impressive.
So the 30% of last year's not going to be the 30 per cent of this year. It will be very different phones [laughter]. The next few years, so but on the other hand, we feel.
As a growth company and we will be very comfortable to stay ahead continue to keep 15% 20% of the kind of growth ranch, we don't feel any problem, but on the other hand of costs 30 per cent is always something we are trying to achieve but but as your face becomes so large right.
[laughter] have to be realistic.
Really appreciate all the thoughts thank you.
And that does conclude our Q&A. Thank you for your participation today's conference. It concludes the program and you may now disconnect.
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