Q1 2025 Cytek Biosciences Inc Earnings Call

May 8, 2025

All lines have been please on mute to prevent any background noise.

The speaker's remarks, there will be a question and answer session. If you would like to ask a question. During this time simply press star followed by the number one on your telephone keypad.

If you would like to withdraw your question Press Star one again.

Speaker Change: I would now like to turn the conference over to Paul Goodson head of Investor Relations. Please go ahead Sir.

Paul Goodson: Thank you operator earlier today.

Paul Goodson: Sciences released financial results for the first quarter ended March 31 2025.

Wenbin Jiang: We continue to express concerns on capital equipment spending in the U.S. and America due to these conditions. We will provide more details on this outlook shortly. While we continue to operate in a dynamic market environment, the durable foundation we have built enables us to be agile and to drive fashion forward through uncertain times. And most importantly, we remain confident in our positioning. We are serving a large and growing sale analysis market with our industry-leading sale analysis portfolio. Global diversification and the critical first mover advantage we have in FSP technology. More than 50% of our product sales are outside of the U.S.

Paul Goodson: You Havent received this news release or if you'd like to be added to the Companys distribution list. Please send an email to investors at <unk> bio dot com.

Paul Goodson: A copy of the news release is also available on the Investor Relations section of <unk> website at investors Slide Tech bio Dot com.

Paul Goodson: Joining me today from <unk>, Zhang CEO and Bill Mccomb CFO. Please note that we will be referencing a slide presentation. During the call today that has been posted to the investors section of our corporate website.

Thank you for standing by at this time I would like to welcome everyone to decide take Biosciences first quarter at 2025 earnings Conference call. All lines have been placed on mute to prevent any background noise.

Oh, So you speakers remarks, there will be a question and answer session.

Paul Goodson: As a reminder, we will make statements during the 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.

You would like to ask a question. During this time simply press star followed by the number one on your telephone keypad if.

If you would like to withdraw your question Press Star one again.

Wenbin Jiang: To support our customers worldwide, we have established manufacturing operations in three countries, the U.S., China, and Singapore. This manufacturing footprint enables region-for-region manufacturing and allows us to optimize product flows for any global health environment. We further believe that having multiple manufacturing locations enhances the resilience of our supply chain, thereby ensuring more reliable and cost-effective product availability for our customers.

Speaker Change: I would now like to turn your conference over to Paul Good son head of Investor Relations. Please go ahead Sir.

Paul Goodson: 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 in these statements.

Paul Goodson: Thank you operator earlier today, so I kept biosciences released financial results for the first quarter ended March 31 2025.

Paul Goodson: Additional information regarding these risks and uncertainties appears in our slide presentation in the section entitled forward looking statements in the press release High Tech issued today and in <unk> filings with the SEC.

Paul Goodson: You Havent received this news release or if you'd like to be added to the Companys distribution list. Please send an email to investors at <unk> bio dot com.

Paul Goodson: A copy of the news release is also available on the Investor Relations section of <unk> website at investors Slide Chuck Bio Dot com.

Paul Goodson: This call will also include a discussion of certain financial measures that are not calculated in accordance with generally accepted accounting principles.

Wenbin Jiang: Our current manufacturing capacity for instruments and reagents can more than adequately support our customers for the foreseeable future without additional capital investment in production facilities.

Paul Goodson: Additional information regarding our use of non-GAAP financial measures, including reconciliations to the most directly comparable GAAP financial measures maybe found in our slide presentation and in today's press release.

Wenbin Jiang: I would now like to update you on the progress our team has made across our core strategic pillars, instruments, applications, bioinformatics, and clinical, to solidify SCI-SEC's position as a market leader in next-gen cell analysis solutions. starting with our core instruments on slide five. In the first quarter, we expanded our global footprint by 115 instruments, bringing Cytek's total install base to 3,149 units.

Paul Goodson: While the company believes these non-GAAP financial measures provide useful information for investors. The presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP.

Paul Goodson: These statements are based on the Companys current expectations and inherently involve significant risks and uncertainties that could cause actual results or events to materially differ from those anticipated in these statements.

Paul Goodson: 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.

Paul Goodson: This conference call contains sensitive information and is accurate only as of the live broadcast may eight 2025.

Wenbin Jiang: In the first quarter, we also announced the launch of the Cytek Muse micro system. The MUSE Microcell Analyzer is an affordable option that synthesizes flow cytometry while enhancing ease of use, precision, and versatility. This latest instrument expands earthquake capabilities to drive adoption in new emerging markets, such as cell and gene therapy and drug discovery, by enabling smaller labs and resource-limited facilities to access high-quality flow cytometry at a cost-effective price.

Paul Goodson: Finally, I would like to invite analysts and institutional investors to attend to any of the <unk> user group meeting the sidetrack will be hosting in 2025.

Paul Goodson: This call will also include a discussion of certain financial measures that are not calculated in accordance with generally accepted accounting principles.

Paul Goodson: These are typically all day meetings, where sci-tech scientists and users of <unk> instruments meet to discuss research initiatives advances in the field and use cases for <unk> products the.

Paul Goodson: The next meeting will be in La Jolla on may 15th at the <unk> Hotel.

Paul Goodson: In addition to the <unk> user group meetings this year.

While the company believes these non-GAAP financial measures provide useful information for investors. The presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP.

Paul Goodson: There will be a variety of industry and academic conferences meetings and seminars.

Wenbin Jiang: While revenues were down in Q1 2024 in both the academic and government, and the biopharma market segment. We believe this was largely due to market weakness rather than market share loss. or competitive position as a leader in the FFP market segment remains strong. We have established a significant commercial footprint and brand identity in the U.S. and America and are expanding our market leadership in APAC and in the rest of the world region. The large installed base of high-parameter analyzer instruments we have built over time provides a durable foundation for driving recurring revenue growth in our service and evaluation experiments.

Paul Goodson: Where we will be exhibiting at <unk> products in the U S and around the world.

Paul Goodson: While these events are primarily geared to the scientific community. They may offer an opportunity to interact with users of our technologies to learn Wi <unk> instruments are so highly valued by our customers.

Paul Goodson: Except as required by law Sci-tech disclaims any duty to update any forward looking statements, whether because of new information future events or changes in its expectations.

Paul Goodson: We have a limited number of spaces to accommodate members of the financial community. So if you're interested in attending any of these events. Please contact me.

Paul Goodson: This conference call contains.

Paul Goodson: Information and is accurate only as of the live broadcast May eight 2025.

Wang Bin: With that I would like to turn the call over to Wang bin.

Paul Goodson: Finally, I would like to invite analysts and institutional investors to attend any of the <unk> user group meetings check will be hosting in 2025.

Wang Bin: Thanks, Paul.

Wang Bin: Welcome everyone and thank you for your interest in <unk>.

Paul Goodson: These are typically all day meetings, where sci-tech scientists and users by Texas instruments.

Wang Bin: On today's call I will discuss our performance during the third quarter, including factor impacting our business.

Paul Goodson: To discuss research initiatives advances in the field and use cases for <unk> products.

Wenbin Jiang: To expand our adjustable market and accelerate growth, we have made strategic investments to advance our product pipeline with newer generations of products, such as our self-soldering and entry-level to mid-level instruments, including our Northern Lights line and new microsystems. The resilience of our product portfolio amidst a challenging macroeconomic backdrop is demonstrated by the 15% trading 12-month growth in our sales total unit placements and 17% TTM growth in modernized units installed. Within our portfolio, Aurora sales saw the revenue grow 15% year-over-year, and the Northern Lights revenue increased 6% year-over-year in the first quarter. Northern Lights Research Union Only Sales Group, 8% year-over-year.

Wang Bin: <unk> and update our conveniently fab outlook and share details on how we are navigating the dynamic macro environment.

Paul Goodson: The next meeting will be in La Jolla on may 15th at the <unk> Hotel.

Paul Goodson: In addition to <unk> user group meetings this year.

Wang Bin: Next I will provide highlights.

Wang Bin: Our progress in the quarter across all our strategic priorities, while 10 days 75 before ending the call OLED will bill for a more detailed look at our financials.

Paul Goodson: There will be a variety of industry and academic conferences meetings and seminars.

Paul Goodson: Where we will be exhibiting at <unk> products in the U S and around the world.

Wang Bin: Our financial outlook.

Paul Goodson: While these events are primarily geared to the scientific community. They may offer an opportunity to interact with users of our technologies to learn Wisi, Texas instruments are so highly valued by our customers.

Wang Bin: Starting with our first quarter revenue on slide <unk>.

Wang Bin: First quarter revenue in some days when it was $41 5 million.

Paul Goodson: We have a limited number of spaces to accommodate members of the financial community. So if you're interested in attending any of these events. Please contact me.

Wang Bin: Seven 6% compared to the first quarter of <unk> before.

Wang Bin: The year over year decline was driven mainly by weakness in instrument sales in the U S and EMEA, partially offset by strength in instrument sales in APAC.

Wang Bin: With that I would like to turn the call over to Wang bin.

Wenbin Jiang: Notably, both aurora cells and northern light instrument cells have continued the growth trend that we saw in the fourth quarter of 2024. Collectively, these instrument placements represent growth across a diverse customer base, offering comprehensive and better solutions tailored to meet their needs.

Wang Bin: Thanks, Paul.

Wang Bin: Welcome everyone and thank you for your interest in <unk>.

Wang Bin: On the left of the World region.

Speaker Change: On today's call I will discuss our performance in the third quarter, including factors impacting our business.

Wang Bin: Further revenue worldwide reached close to $8 million.

Wang Bin: Increase up 24% versus a year ago.

Speaker Change: To provide an update on our <unk> outlook.

Wang Bin: The growth in service revenue continued its strong performance and that was driven by the expansion of our instrument installed base and usage of our food across a broad range of disciplines.

Speaker Change: Details on how we are navigating this dynamic macro environment.

Wenbin Jiang: Moving to bar overmat is on slide six. I'm pleased to report that the Cytek crowd continues to grow as a vital resource in the research community. Our main goal is to enable our customers to streamline their experimental workflow through our software tools, which drive adoption and utilization of our self-analysis solutions and the growth in our relation and service business. We now have over 18,000 users, which grew by 2,000 users in the first quarter alone. This represents an average of about six users per installed site as FFT instrument, which elevates the loyalty our users have to our product portfolio and demonstrates the halo effect of our platform.

Nick: Nick I will provide highlights.

Nick: Our progress in the quarter across all our strategic priorities for 275 before ending the call OLED for Bill.

Wang Bin: Turning to slide four.

Wang Bin: Diving into the underlying tobacco.

Nick: A more detailed look at our financials and our financial outlook.

Wang Bin: In the last month.

Wang Bin: First quarter, we again see a broad based slowdown instrument order across our U S and EMEA regions.

Nick: Starting with our first quarter revenue on slide three.

Wang Bin: Among the academic and government customers in the U S instrument placements decline given uncertainties with academic quality.

Nick: First quarter revenue in 10 days.

Nick: Was $41 5 million.

Nick: Seven 6% compared to the first quarter of condition before.

Wang Bin: At FHA.

Nick: The year over year decline was driven mainly by weakness in instrument sales in the U S and EMEA, partially offset by strength in instrument sales in APAC.

Speaker Change: EMEA. Thank you.

Speaker Change: Government funding priorities effective purchasing trends.

Speaker Change: Sales across our biotech pharma and see our customers declined.

Wenbin Jiang: The increase in site-to-cloud users affects growth in the usage of our products and is directionally correlated with long-term recurring revenue growth drivers from our regions and service providers.

Nick: <unk> of the world.

Speaker Change: Auto has been postponed for the second quarter, and a customer buying configuring being influenced by the uncertainties across the industry due to the U S policy environment.

Nick: Further revenue worldwide reached $48 million, an increase of 24% versus a year ago.

Nick: So both in service revenue continued its strong performance and the one given by the <unk>.

Speaker Change: Hello glass, Okay. We continued to benefit from a strong demand environment for instruments in the APAC and the rest of the World region, which include the Canada and Latin America.

Wenbin Jiang: Turning to our next growth panel application. While we are in the early innings with our religion business, we continue to believe that it has strong growth potential. We plan to drive growth by accelerating our new religion product introduction engine, which will expand our religion offerings and application specific kits. The share of religions we supply as a percentage of total religion volumes used on our instruments is still at the onset of its growth trajectory. We believe there is a significant growth potential ahead as we continue serving our expanding install base, improving our execution and delivery time to customers, leveraging the Cytek cloud as a religion sales platform.

Nick: <unk> of our instrument installed base and usage of our food across a broad range of disciplines.

Speaker Change: Total revenue in APAC.

Nick: Turning to slide four.

Speaker Change: The last of the World video together was 11.

Nick: Diving into the underlying factor.

Speaker Change: Million.

Speaker Change: Up 35, 6% year over year.

Nick: While.

Nick: For the first quarter, we again see a broad based slowdown in interim of other across our U S and EMEA regions.

Speaker Change: While we are willing to ensure sales in China with a level of conservatism. We continue therefore experienced an increase in orders in the first quarter related to the China stimulus program.

Nick: Among the academic and government customers in the U S instrument placements declined driven by uncertainties with academic quality.

Speaker Change: Due to the lease of a change in the market environment. As a result of these macro economic and policy related factors.

Nick: RFA case.

Nick: In EMEA local government funding priorities affected purchasing trends.

Speaker Change: We now anticipate full year <unk> revenue to be in the LNG of <unk> $6 million to $210 million, we continue to expect some churn.

Wenbin Jiang: and introducing new vision products and applications.

Nick: Sales across our biotech pharma and the CLO customers declined due to weak order has been postponed for the second quarter and the customer buying configuring being influenced by the uncertainties across the industry due to the policy environment.

Wenbin Jiang: Notably, I believe we have reached an interesting point with recurring revenue, including region and service revenue combined, leveraging our established and expanding install base. In the first quarter, we were pleased to see our relation sales positively contribute to our recurring revenue weight at a percentage of our total revenue. Specifically, our trading 12-month recurring revenue is steadily growing, representing 31% of our total revenue in the first quarter. up from 36% a year ago. Further, our chain in 12 months, recurring revenue grew 17% in the first quarter compared to the prior year.

Speaker Change: Capital equipment spending in the U S EMEA due to these conditions.

Speaker Change: Bill will provide a more detailed outlook shortly.

Speaker Change: While we will continue to operate in a dynamic market environment.

Nick: Geographically, we continued to benefit from a stronger demand environment for instruments in APAC.

We are available foundation, we have enabled us to be agile.

Nick: The rest of the World region, which include the Canada and Latin America.

Speaker Change: To drive it forward through uncertain times.

Nick: Total revenue in APAC.

Speaker Change: Importantly, we remain confident in our positioning.

Nick: Last time, when the World video <unk> was 11 4 million.

Speaker Change: We are serving a large and growing scale analysis market with our industry, leading cell analysis portfolio.

Nick: Up 35, 6% year over year.

Nick: While we are willing to share sales in China with a level of conservatism. We continue that we will experience an increase in orders in the first quarter related to the China stimulus program.

Speaker Change: Global diversification.

Speaker Change: The critical flexible the advantage we have at peak economics.

More than 50% of our product sales outside of the U S.

Wenbin Jiang: Long term, we expect our current service and the region's revenue to be stronger growth drivers for us by 2030.

Nick: Due to the lease of the changes in the market environment as a result of these macro economic and policy related factors.

Speaker Change: To support our customers worldwide.

Speaker Change: Establish the manufacturing operations in the country.

Wenbin Jiang: Turning next to clinical, we continue to believe the clinical market represents an attractive business opportunity for Cytek, and we have seen considerable growth in the EU and APEC for clinical applications. In the EU, one academic hospital fully validated our Minimal Residual Disease, or MRD, panel for leukemia and lymphoma, and will begin implementing it in their routine clinical testing this quarter. As a key opinion leader, this institution has also supported our outreach to other clinical sites in the Netherlands, Australia, and Brazil.

Nick: Now anticipate full year estimate of the final revenue.

Speaker Change: China and Singapore.

Speaker Change: This manufacturing footprint enables lesion Canadian manufacturing and allows us to optimize product flow for any global healthy environment.

Nick: The logic of why Youre, not a $6 million to $210 million.

Nick: We continue to expect some churn.

Nick: Taxable equivalent spending in the U S EMEA due to these conditions.

Speaker Change: We started up.

Speaker Change: That having multiple manufacturing locations enhancing the resilience of our supply chain, thereby ensuring more reliable and cost effective product availability for our customers.

Nick: Al will provide a more detailed outlook this outlook shortly.

Nick: While we will continue to operate in a dynamic market environment, where available foundation, we have enabled us to be agile.

Speaker Change: Our current manufacturing capacity for our instruments and rigging can more than adequately support our customers for the foreseeable future without additional capital investment in production facilities.

Nick: Through just a follow up to.

Nick: Through uncertain times.

Nick: Importantly, we remain confident in our positioning.

Wenbin Jiang: Overall, I'm encouraged by our results, despite challenging macro headwinds in the US and India. We have areas of strength in high-growth regions, including in Asia-Pacific, and a strength in our south-southern and northern light-inch regions. The large installed base we have built worldwide provides the basis for long-term growth in our recurring services and religion businesses, and offers the opportunity to scale our instrument offerings.

Nick: We are serving a large and growing in scale analysis market with our industry, leading cell analysis portfolio.

Speaker Change: I would now like to update you on the <unk>.

Speaker Change: Our team has made across our core strategic pillar instrument applications <unk> and critical both solidify <unk> position as a market leader in net cash cow analysis solutions.

Nick: Global diversification and the critical flash from mobile and the medication, we have FTE economics.

Nick: More than 50% of our product sales are outside of the U S.

Nick: Paul support our customers worldwide, we have established a manufacturing operation in three countries the U S, China and Singapore.

Speaker Change: Yeah.

Starting with our core instruments on slide five.

Speaker Change: In the first quarter.

Speaker Change: And in our global footprint by 1015 instruments, bringing <unk> total installed base to three.

Wenbin Jiang: I believe that we are well positioned to emerge from this period even stronger than we are today. Leveraging our industry-leading sales analysis portfolio and strong business fundamentals.

Nick: This manufacturing footprint enables region for region manufacturing and allows us to optimize product flow for any global healthy environment.

Speaker Change: <unk> 3149 units.

Speaker Change: In the first quarter, we also announced the launch of the site and the new micro system.

Nick: We further believe that having multiple manufacturing locations enhance the resilience of our supply chain, thereby ensuring more reliable and cost effective product availability for our customers.

Bill McCombe: With that, I will now turn the call over to Bill for more details about our financials. Thanks, Wenbin. Turning to slide 7 and our first quarter financial results. Total revenue for the first quarter of 2025 was $41.5 million, a 7.6% decrease compared to the first quarter of 2024. Product revenue, which is instruments and reagents, decreased 18% versus Q1 of 2024. This decrease was driven by a weaker interest market in the U.S. and EMEA. As Wenbin described earlier, this was primarily due to academic funding uncertainties in the U.S. Pressure on government budgets in EMEA, causing delays in academic and research funding, and a cautious capital spending environment in the biotech and pharma industries.

Speaker Change: Micro cell analyzer is an affordable option that synchronized growth by penetrating while enhancing EW proficient in Nebraska.

Speaker Change: Our current manufacturing capacity for instruments and Greg.

Speaker Change: This latest instrument expands <unk> capabilities to drive adoption in new emerging market, especially in cell and gene therapy and drug discovery by enabling smaller lab on the leasehold for limited facilities to access high quality flow cytometry, and a cost effective price.

Nick: And more than adequately support our customers for the <unk>.

Nick: Foreseeable future without additional capital investment in production.

Nick: Yes.

Nick: I would now like to update you on the progress our team has made across our core strategic pillar instrument applications piloting biometric and critical.

Speaker Change: While revenues were down in Q1 conditions in both the academic and government.

Nick: <unk> position as a market leader in net cash cow analysis solutions.

Speaker Change: The biopharma market sentiment.

Speaker Change: We believe this was largely due to market weakness rather than knock the handoffs.

Nick: Starting with our core instruments out slide five.

Nick: In the first quarter.

Speaker Change: Our competitive position as a leader in the FSP market sentiment demand.

Nick: Expanding our global footprint by 1015 instruments.

Bill McCombe: Service revenue was a bright spot, growing 24%, so this is Q1 of 2025. Growth in service revenue reflects continued expansion of our installed base of instruments and active usage of our. Turning to our geographic market performance, total U.S. and EMEA revenue declined 13% and 24% respectively, driven by lower instrument sales for the reasons I mentioned. On the other hand, Asia-Pacific grew very strongly, up 40%, driven by particularly strong growth in China. Other international markets, primarily Canada and Latin America, also grew strongly off a small base. We believe this growth reflects the strength of Cytek's brand and customer preference for our technology globally.

Speaker Change: We have established significant commercial footprint and our brand identity in the U S and EMEA and extending our market leadership in APAC and in the rest of the World region.

Nick: <unk> total installed base to 3149 units.

Nick: In the first quarter, we also announced the launch of a new micro Stephane.

Speaker Change: The largest installed base of high parameter analyzer instruments, we have built over time provide available foundation for driving revenue growth in our service and the agency businesses.

Nick: Remove micro cell analyzer is an affordable option that synchronized growth by penetrating while enhancing EW.

Nick: Second in Nebraska.

Nick: This latest instrument expands <unk> capabilities to drive adoption in new emerging market, especially in cell and gene therapy and drug discovery by enabling smaller lab on a leasehold preliminary facilities to access high quality flow cytometry in a cost effective price.

To expand our addressable market and accelerate growth, we have made strategic investments to advance our product pipeline with newer generations of products, especially as our sales product and entry level to mid level instruments, including our northern like lung.

Bill McCombe: Gap gross profit was $20.2 million for the first quarter of 2025, a decrease of 12% compared to gross profit of $23 million in the first quarter of 2024. Gap gross margin was 49% in the first quarter compared to 51% in the prior year. Non-GAAP-adjusted gross margin in the first quarter was 52 percent compared to 55 percent in the prior year quarter. The declining gap in adjusted gross margin was primarily due to lower product revenues and higher manufacturing overhead. This was offset by a higher service gross margin compared to a year ago. We expect quarterly gross margin to improve for the balance of the year as quarterly revenue increases consistent with typical seasonal pattern.

Nick: While revenues were down in Q1 contained home depot in both the academic and government and the Biopharma market segment.

Speaker Change: Meals Microsystems.

Speaker Change: The resilience of our product portfolio, a challenging macroeconomic backdrop and demonstrated by the 15% trailing 12 month growth in our sales sort of unit placements.

Nick: We believe this was largely due to market weakness rather than market share loss.

Nick: Our competitive position.

Speaker Change: 17% TTM growth in northern lights units installed.

Nick: A leader in the FSP market sentiment demand.

Speaker Change: Within our portfolio or our sales total revenue grew 15% year over year and another license revenue increased 6% year over year in the first quarter.

Nick: We have established.

Nick: Difficult commercial footprint and our brand identity in the U S and EMEA and extending our market leadership in APAC and in the rest of the World region.

Speaker Change: Normalized <unk> OE sales grew 8% year over year.

Nick: The large installed base of high parameter analyzer instruments, we have build over time provides available foundation for driving revenue growth in our service and valuation businesses.

Speaker Change: Notably both or all of our sales soda in northern lights instrument sales have continued the growth trend that we saw in the fourth quarter of data and people.

Speaker Change: Collectively these instrument placements and represented growth across a diverse customer base offering comprehensive and the better solutions tailored to meet their needs.

Bill McCombe: Operating expenses were $35.1 million for the first quarter, an increase of $1.4 million from the prior year. Research and development expenses were $9.7 million for the first quarter, down $0.1 million from the first quarter of 2024. Sales and marketing expenses were $12.5 million for the first quarter, flat versus the first quarter of 2024. General and Administrative expenses were $12.9 million for the first quarter, up $1.5 million from the first quarter of 2024 due to higher outside services and headcount . Loss from operations was $15 million for the first quarter compared to the $10.7 million loss from operations in the prior year quarter.

Nick: To expand our addressable market and accelerate growth, we have made strategic investments to advance our product pipeline with newer generations of products, especially as our sales product and entry level to mid level instruments, including our northern like lung.

Speaker Change: Moving to <unk> on slide six.

<unk> fully o'clock.

Speaker Change: The FICA cloud continues to grow as a vital resource in the research community.

Speaker Change: Our main goal is to enable our customers to streamline their expanding on workflow through our software tools, which drive adoption and utilization of our cell analysis solutions and the growth in order to Adrian and service businesses.

Nick: Micro system.

Nick: The resilience of our product portfolio, and a challenging macroeconomic backdrop and demonstrated by the 15% trailing 12 month growth in our scale solar unit placements and 17% TTM growth in northern nights DNS installed.

Speaker Change: We now have over 18000 users, which grew by 2000 users in the first quarter alone.

Nick: Within our portfolio.

Nick: Overall, our sales total revenue grew 15% year over year and another license revenue increased 6% year over year in the first quarter.

Speaker Change: This represents an average.

Speaker Change: Rich.

Speaker Change: Six years of proteins for the site.

Speaker Change: Instrument, which and renovate the loyalty of our users had to our product portfolio and demonstrates the halo effect of our platform.

Bill McCombe: Gap net loss was $11.4 million in the first quarter compared to gap net loss of $6.2 million in the prior year quarter. This was primarily due to a larger loss from operations of 15 million in the current quarter versus 10.7 million a year ago and a tax expense of 0.1 million versus a tax benefit of 2.8 million a year ago offset by higher other income due to 1.3 million foreign exchange gain in the current quarter compared to a 1.1 million FX loss in the prior year quarter. Adjusted EBITDA, which excludes stock-based compensation and foreign currency impacts, decreased to a loss of $3.3 million for the first quarter due to lower gross profit, compared to a loss of $0.7 million in Q1 of last year.

Nick: Northern White <unk> OE sales grew 8% year over year.

Nick: Notably both or all our sales soda in northern light instrument sales have continued the growth trend that we saw in the fourth quarter of data in April.

The increase in tanker crawl user effects growth in the usage of our products.

Nick: Collectively these instrument placements and represented growth across a diverse customer base offering comprehensive and the better solutions tailored to meet their needs.

Speaker Change: That's really correlated with long term recurring revenue growth drivers from our agents and our service businesses.

Speaker Change: Turning to our next growth pillar applications.

Nick: <unk> to <unk> on slide six.

Speaker Change: While we are in the early innings with our Lincoln benefit we continue to believe that it has strong growth potential we plan to drive growth by accelerating our new reagent product introduction engine.

Nick: Full year costs.

Nick: The FICA cloud continues to grow as a vital resource in the research community.

Nick: Our main goal is to enable our customers to streamline their expanding on workflow through our software tools, which drive adoption and utilization of our cell analysis solutions and the growth in our under Adrian and service businesses.

Speaker Change: <unk> will expand our <unk> offering and applications critical kit.

Speaker Change: Share of Megan we supply as a percentage of total <unk> volume use our instruments and skill at the <unk>.

Bill McCombe: Adjusted EBITDA included an investment income of $2.3 million. Excluding this amount, adjusted EBITDA loss was $5.5 million in Q1 compared to a loss of $2.6 million in Q1 of last year. We expect adjusted EBITDA to improve on a quarterly basis as revenues and gross margins increase consistent with typical seasonal patterns. Total cash in marketable securities decreased $12.3 million versus Q4 to $265.6 million as of March 31, 2025. The decline was primarily driven by our investment of $10.6 million to repurchase shares during Q1.

Nick: We now have over 18000 users, which grew by 2000 users in the first quarter alone.

Speaker Change: Onset of its growth trajectory.

Speaker Change: We believe net as a significant growth potential.

Nick: Represents an average of about six users proteins for the site.

Speaker Change: We continue serving our expanding installed base.

Speaker Change: Proving our execution and the delivery time for customer level. Despite the cloud evolution sales platform.

Rich and renovate the loyalty of our users had to our product portfolio and demonstrates the halo effect of our platform.

Speaker Change: And introducing new products and applications.

Nick: The increase in tanker call user and affect growth in the usage of our products.

Notably I believe we have reached an inflection point with recurring revenue, including reagents and service revenue combined with leveraging our established and expanding installed base.

Nick: Directionally correlated with long term recurring revenue growth drivers from our agents and our service businesses.

Nick: Turning to our next growth pillar applications.

Speaker Change: In the first quarter, we were pleased to see our reagent sales positively contribute to our recurring revenue wait at a percentage of our total revenue.

Bill McCombe: Lastly, turning to our four-year guidance on page eight.

Nick: We are in the early innings with our Lincoln benefit we continue to believe that it has strong growth potential we plan to drive growth by accelerating our new agent product introduction engine, which will expand our <unk> offering and applications critical kit.

Bill McCombe: As Wenbin described earlier, due to the significant change in our market environment since our last earnings call in late February, we are revising our full year 2025 revenue outlook to a range of $196 million to $210 million, representing overall growth of minus 2% to plus 5% over full year 2024, assuming no change in currency exchange Consistent with our typical seasonal pattern, and especially given the current uncertainties in the market and geopolitical environment, we expect this growth to be back unloaded to the second half of 2025. As Wenbin further noted, our market leadership position remains strong and we believe we will perform well relative to the overall flow cytometry market.

Speaker Change: Specifically, our trailing 12 months recurring revenue steadily growing representing 31% of our total revenue in the first quarter.

Speaker Change: Up from 26% a year ago.

Nick: The share of Megan we supply as a percentage of total <unk> volume use our instruments in scale at the onset of its growth trajectory.

Speaker Change: Further our trailing 12 months recurring revenue grew 17% in the first quarter compared to the prior year.

Speaker Change: Longer term, we expect our coding product in emulation revenue could be stronger growth drybulk spot pricing.

Nick: We believe that as a significant growth potential.

Nick: We continue serving our expanding installed base, improving our execution and the deliberate handful customers leveraging the site the cloud acceleration sales platform.

Speaker Change: Turning next to critical we continue to probably no clinical markets and represents an attractive business opportunity for cycling and we have seen considerable growth in the EU in APAC for clinical applications.

Nick: And introducing new products and applications.

Nick: Notably I believe we have reached an inflection point with recurring revenue, including Malaysia and service revenue combined.

Speaker Change: In the year, one academic hospital fully validated our minimal residual disease or <unk>.

Bill McCombe: Our strong balance sheet also gives us the ability to continue investing for growth.

Wenbin Jiang: With that, I'll turn it back over to Wenbin. Thanks, Bill. Turning to Slide 9.

Speaker Change: The panel for leukemia, and lymphoma, and we will begin implementing it in.

Nick: Leveraging our established and expanding installed base.

Nick: In the first quarter, we were pleased to see our reagent sales positively contribute to our recurring revenue weight as a percentage of our total revenue.

Speaker Change: England routine clinical testing this quarter.

Wenbin Jiang: I want to take a moment to thank our team at Cytek for their dedication to our mission and overall resilience amidst a very difficult market backdrop. It is this shared belief that positions us well as we strengthen our foundation for the future. We are serving a large and growing share analysis market as a market leader. We continue to make thoughtful investments in our product pipeline and our service teams to drive growth and innovation, and to strengthen our competitive position. Our strong balance sheet underpins our foundation, which provides us with options and further flexibility in the future.

Speaker Change: As a key opinion leader. This institution has also supported our outreach to other clinical sites in the Netherlands, Australia and Brazil.

Nick: Specifically, our trailing 12 months recurring revenue in steadily growing representing 31% of our total revenue in the first quarter.

Speaker Change: Although I'm encouraged by our results despite challenging macro headwinds in the U S.

Nick: Up from 26% a year ago.

Speaker Change: We had areas of strength in high growth regions, including in Asia Pacific and Australia in our sales further in northern light intermodal.

Nick: Further our trailing 12 months recurring revenue grew 17% in the first quarter compared to the prior year.

Nick: Longer term, we expect our recurring service and <unk> revenue could be stronger growth drive low cost high tech.

Speaker Change: The large installed base, we have built worldwide provides the basis for long term growth in our recurring services and <unk> businesses.

Nick: Turning next to critical we continue to probably the clinical market and represents an attractive business opportunity for mitek and we have seen considerable growth in the EU in APAC for clinical applications.

Speaker Change: Offers the opportunity to scale our instrument offerings.

Speaker Change: I believe that we are well positioned to emerge from this period, even stronger than we are today.

Wenbin Jiang: We have a clear roadmap to expand our market leadership position in sale analysis. These powerful attributes provide us with confidence in our long-term objective of delivering sustainable growth and profitability.

Speaker Change: Leveraging our industry, leading cell analysis portfolio and strong business fundamentals.

Nick: In the year, while academic hospitals fully validated our minimal residual disease or <unk>.

Speaker Change: With that I'll now turn the call over to Bill for more details about our financials. Thanks, London turning to slide seven in our first quarter financial results total.

Nick: The panel for leukemia lymphoma and <unk>.

Wenbin Jiang: I want to thank everyone for joining today's call, and we will now open it up for questions. All favorite. Thank you.

Nick: We will begin implementing it England.

Nick: England routine clinical testing this quarter.

Nick: As a key opinion leader. This institution has also supported our outreach through other clinical site in the Netherlands, Australia and Brazil.

Speaker Change: Total revenues for the first quarter of 2025 was $41 5 million or seven 6% decrease compared to the first quarter of 2024.

Operator: We will now begin the question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join the We will pause for just a moment to compile the Q&A roster.

Speaker Change: Although I'm encouraged by our results despite challenging macro headwinds in the U S and EMEA.

Speaker Change: Product revenue, which is influencing reagents decreased 18% versus Q1 of 2024.

Speaker Change: We have areas of strength in high growth regions, including in Asia Pacific and Australia, our sales further in northern light intermodal.

Speaker Change: This decrease was driven by weaker market in the U S and EMEA.

Speaker Change: As Brendan described earlier this was primarily due to academic funding uncertainties in the U S.

Tejas Savant: Your first question comes from the line of Tejas Savant with Morgan Stanley. Your line is open. Hi, this is Jason on for Tejas. Um, so peristeponite, key focus, fire in fast. So I sound manageable for Cytek, but I just want to... Do we expect any gross margin impact? Apologies if I missed her, I believe you said Cytek? It is a current available inventory to provide a buffer. But obviously that is just temporary. So I was wondering if you could quantify like a gross margin impact from the current And then you talked about some supply chain mitigants.

Speaker Change: The large installed base, we have built worldwide provides the basis for long term growth in our recurring services and imaging businesses.

Speaker Change: Pressure on government budgets in EMEA, causing delays in academic and research funding and of course as capital spending environment in the biotech and pharma industries.

Speaker Change: Offers the opportunity for scale our instrument offerings.

Speaker Change: I believe that we are well positioned to emerge from this period, even stronger than we are today.

Speaker Change: Service revenue was a bright spot growing 24% versus Q1 of 2024.

Speaker Change: Growth in service revenue reflects continued expansion of our installed base of instruments and active usage of our systems.

Speaker Change: Leveraging our industry, leading cell analysis portfolio and strong business fundamentals.

Speaker Change: With that I will now turn the call over to Bill for more details about our financials. Thanks, Glen then turning to slide seven in our first quarter financial results total.

Speaker Change: Turning to our geographic market performance total U S and EMEA revenue declined 13% in 2012%, respectively, driven by lower instrument sales for the reasons I mentioned.

Speaker Change: Total revenues for the first quarter of 2025 was $41 5 million or seven 6% decrease compared to the first quarter of 2024.

Tejas Savant: I don't believe I heard you talk really about pricing. So is pricing something Cytek could turn to also as a... And I guess the third part would be, there's currently 125% tariffs from China. So obviously, it's very hard to sell any products there. I'm wondering how much of the 2025 revenue guidance cut could be because of this dynamic, like the inability to sell.

Speaker Change: On the other hand Asia Pacific grew very strongly up 40% driven by particularly strong growth in China.

Speaker Change: Other international markets, primarily in Canada, and Latin America also grew strongly off a small base.

Speaker Change: Product revenue, which is influencing reagents decreased 18% versus Q1 of 2024.

Speaker Change: We believe this growth reflects the strength of <unk> brand and customer preference for our technology globally.

Speaker Change: This decrease was driven by weaker market in the U S and EMEA.

Speaker Change: GAAP gross profit was $20 2 million for the first quarter of 2025, a decrease of 12% compared to gross profit of $23 million in the first quarter of 2020 for.

Speaker Change: As Brendan described earlier this was primarily due to academic funding uncertainties in the U S.

Speaker Change: Pressure on government budgets in EMEA, causing delays in academic and research funding and of course as capital spending environment in the biotech and pharma industries.

Wenbin Jiang: Okay, let me try to take those in order. So that the it's important to understand that we have established manufacturing facilities that are all producing and shipping products. in three regions, the US, Singapore, which is our new facility, and Wuxi, China. And so our primary strategy for managing tariffs is what we call region for region manufacturing. So we make product for sale in a particular region, in the region that would be least impacted by tariffs. So making product for Asia and Europe in Asia and US product, product for sale in the US. Obviously, we can't do that 100%, but we are able to mitigate a substantial portion of the potential tariff liability that way.

Speaker Change: GAAP gross margin was 49% in the first quarter compared to 51% in the prior year.

Speaker Change: Service revenue was a bright spot growing 24% versus Q1 of 2024.

Speaker Change: non-GAAP adjusted gross margin in the first quarter was 52%.

Speaker Change: To 55% in the prior year quarter.

Speaker Change: Growth in service revenue reflects continued expansion of our installed base of instruments and active usage of our systems.

Speaker Change: The decline in GAAP and adjusted gross margin was primarily due to lower product revenues and higher manufacturing overhead.

Speaker Change: Turning to our geographic market performance total U S and EMEA revenue declined 13% in 2012%, respectively, driven by lower instrument sales for the reasons I mentioned.

Speaker Change: This was offset by higher service gross margin compared to a year ago.

Speaker Change: We expect quarterly gross margin to improve for the balance of the year as quarterly revenue increases consistent with typical seasonal patterns.

Speaker Change: On the other hand Asia Pacific grew very strongly up 40% driven by particularly strong growth in China.

Speaker Change: Operating expenses were $35 1 million for the first quarter, an increase of $1 4 million from the prior year.

Speaker Change: Other international markets, primarily in Canada, and Latin America also grew strongly off a small base.

Research and development expenses were $9 7 million for the first quarter down $1 million from the first quarter of 2024.

Speaker Change: We believe this growth reflects the strength of <unk> brand and customer preference for our technology globally.

Speaker Change: GAAP gross profit was $20 2 million for the first quarter of 2025, a decrease of 12% compared to gross profit of $23 million in the first quarter of 2020 for GAAP.

Speaker Change: Sales and marketing expenses were $12 5 million for the first quarter flat versus the first quarter of 2024.

Speaker Change: General and administrative expenses were $12 9 million for the first quarter up $1 5 million from the first quarter of 2024.

Speaker Change: GAAP gross margin was 49% in the first quarter compared to 61% in the prior year.

Wenbin Jiang: The other thing that we can do is reorganize where we source components from. And then thirdly, we are recovering some costs from customers through surcharges. And so those are the strategies for dealing with tariffs. We don't think that that will have any significant impact on our revenues in 2025. When I say that, I'm obviously putting to one side the uncertainties created by the economic and market environment that we're in. But in terms of tariffs specifically, we don't think that will have an impact. In terms of gross margin, the impact, I think, is we'll be fairly limited and in the range of 1% to 3%.

Speaker Change: Higher outside services and head count expense.

Speaker Change: non-GAAP adjusted gross margin in the first quarter was 52% compared to 55% in the prior year quarter.

Speaker Change: Loss from operations was $15 million for the first quarter compared to the $10 7 million loss from operations in the prior year quarter.

Speaker Change: The decline in GAAP and adjusted gross margin was primarily due to lower product revenues and higher manufacturing overhead.

Speaker Change: GAAP net loss was $11 4 million in the first quarter compared to GAAP net loss of $6 2 million in the prior year quarter.

Speaker Change: This was offset by higher service gross margin compared to a year ago.

Speaker Change: This was primarily due to a larger loss from operations assisting million dollars in the current quarter.

Speaker Change: We expect quarterly gross margin to improve for the balance of the year as quarterly revenue increases consistent with typical seasonal patterns.

Speaker Change: <unk> was $10 7 million a year ago, and a tax expense of $2 1 million versus a tax benefit of $2 8 million a year ago offset by higher other income due to $1 3 million foreign exchange gain in the current quarter compared to a $1 1 million FX loss in the prior year quarter.

Speaker Change: Operating expenses were $35 1 million for the first quarter, an increase of $1 4 million from the prior year.

Speaker Change: Research and development expenses were $9 7 million for the first quarter down $1 million from the first quarter of 2024.

Speaker Change: Adjusted EBITDA, which excludes stock based compensation and foreign currency impacts.

Speaker Change: Sales and marketing expenses were $12 5 million for the first quarter flat versus the first quarter of 2024.

Speaker Change: It turns to a loss of $3 3 million for the first quarter.

Speaker Change: General and administrative expenses were $12 9 million for the first quarter up $1 5 million from the first quarter of 2024.

Due to lower gross profit compared to a loss of <unk> 7 million in Q1 of last year.

Wenbin Jiang: And in that regard, We would expect, as I mentioned in my remarks, that gross margin will improve over the ensuing quarters because we expect that revenues will follow a typical seasonal pattern where they'll be stronger in Q2, Q3, and Q4. And with higher revenues, we will see a benefit at the gross margin line. Did I cover all your questions? Yeah, most of it. And then the third part, just about the 125% tariff from China and U.S. exports. Are you still able to sell your products in China? We are able to sell products in China, absolutely.

Speaker Change: Adjusted EBITDA included investment income of $2 3 million. Excluding this amount adjusted EBITDA loss was $5 5 million in Q1 compared to a loss of $2 6 million in Q1 of last year.

Speaker Change: Higher outside services and head count expense.

Speaker Change: Loss from operations was $15 million for the first quarter compared to $10 7 million loss from operations in the prior year quarter.

Speaker Change: GAAP net loss was $11 4 million in the first quarter compared to GAAP net loss of $6 2 million in the prior year quarter.

Speaker Change: We expect adjusted EBITDA to improve on a quarterly basis as revenues and gross margins increase consistent with typical seasonal patterns.

Speaker Change: This was primarily due to a larger loss from operations assisting million dollars in the current quarter.

Speaker Change: Total cash and marketable securities decreased $12 3 million versus Q4 to $265 6 million as of March 31 2025.

Speaker Change: $10 7 million, a year ago, and a tax expense of $2 1 million versus a tax benefit of $2 8 million a year ago offset by higher other income due to $1 3 million foreign exchange gain in the current quarter compared to a $1 1 million FX loss in the prior year quarter.

Speaker Change: The decline was primarily driven by our investment of $10 6 million to repurchase shares during Q1.

Speaker Change: Lastly, turning to our full year guidance on page eight.

Wenbin Jiang: But that's the way that we deal with that tariff. through our region for region manufacturing. So obviously, products sold in China don't incur a tariff if they're manufactured in China or if they're manufactured in Singapore.

Speaker Change: As Brendan described earlier due to the significant change in our market environment since our last earnings call. In late February we are revising our full year 2020 times revenue outlook to a range of $196 million to $210 million, representing overall growth of minus 2% to plus five.

Speaker Change: Adjusted EBITDA, which excludes stock based compensation and foreign currency impacts decreased to a loss of $3 3 million for the first quarter.

Speaker Change: Due to lower gross profit compared to a loss of <unk> 7 million in Q1 of last year.

Tejas Savant: Great. Thank you for the clarion that.

Tejas Savant: And if I may ask just to follow up, so the academic government and market, it seems like the policy situation just might have gotten worse since you last guided in 4Q. So we're seeing significant disruption in government funding at universities with some of the country's largest research budgets. There was also like a proposed 40% cut in the proposed 2026 budget to the NIH. So I'm just wondering, like, how are you thinking about, like, these potential risks to your 2025 guide? And what was your overall outlook for this end market? Like, do you think maybe, like, minus mid-single-digit decline could be reasonable?

Speaker Change: 5% of our full year 2024, assuming no change in currency exchange rates.

Speaker Change: Consistent with our typical seasonal pattern and especially given the current uncertainties in the market and geopolitical environment. We expect this growth to be back end loaded to the second half of 2025.

Speaker Change: We expect adjusted EBITDA will improve on a quarterly basis as revenues and gross margins increased consistent with typical seasonal patterns.

Speaker Change: Brendan further noted our market leadership position remains strong and we believe we will perform well relative to the overall flow cytometry market.

Speaker Change: Total cash and marketable securities decreased $12 3 million versus Q4 to $265 6 million as of March 31 2025.

Speaker Change: Our strong balance sheet also gives us the ability to continue investing for growth with that I'll turn it back over to Wendy.

Wenbin Jiang: We look at the uncertainties associated with the The funding in the US is factored into our revised guidance. That's one of the new issues that caused us to come out with this revised guidance. The short answer to the question is it's factored into what we've told you about revenue expectations. I would make a couple of points, though. One is that more than 50% of our revenue is outside the United States. So obviously, you know, that revenue isn't affected by U.S. university funding. And then thirdly, and most importantly, is we think about our revenue in three buckets.

Speaker Change: The decline was primarily driven by our investment of $10 6 million to repurchase shares during Q1.

Speaker Change: Thanks, Joe.

Speaker Change: Turning to slide nine.

Speaker Change: I'll also take a moment to thank our king at <unk> for their dedication to our mission and the overall resilience amidst a very difficult market backdrop.

Speaker Change: Lastly, turning to our full year guidance on page eight.

Speaker Change: As Wendell described earlier due to the significant change in our market environment since our last earnings call. In late February we are revising our full year 2020, Todd revenue outlook to a range of $196 million to $210 million, representing overall growth of minus 2% to plus five.

Speaker Change: It is this share the belief that positions us well.

Speaker Change: Sending our foundation for the future.

Speaker Change: We are serving a large and growing cell analysis market.

Speaker Change: Market leader.

Speaker Change: We continue to make thoughtful investments in our product pipeline and our service teams to drive growth and innovation.

Speaker Change: 5% of the full year 2024, assuming no change in currency exchange rates.

Speaker Change: To strengthen our competitive position.

Speaker Change: Our strong balance sheet that underpins, our foundation, which provides us with options and further flexibility in the future.

Speaker Change: As Brendan further noted our market leadership position remains strong and we believe we will perform well relative to the overall flow cytometry market.

Speaker Change: We have a clear roadmap to expand our market leadership position in scale analysis.

Wenbin Jiang: It's service, which is growing strongly. Reagents, which also saw some nice growth in Q1, particularly in U.S. and EMEA. And then the instrument portion of our revenue is the one that's most impacted. issues like the one that you mentioned. But the other two revenue sources or revenue streams are not particularly affected by U.S. university funding issues. All that said, we are continuing to sell instruments to U.S. universities here in the second quarter.

Speaker Change: These powerful attributes provide us with confidence in our long term objective of delivering sustainable growth and profitability.

Speaker Change: Our strong balance sheet also gives us the ability to continue investing for growth.

Speaker Change: That I will turn it back over to Wendy.

Speaker Change: I want to thank everyone for joining today's call and we will.

Wendy: Thanks, Joe.

Speaker Change: We'll now open it up for questions.

Wendy: Turning to slide nine.

Wendy: While it will take a moment to thank <unk> and <unk> for their dedication to our mission and the overall agreement.

Speaker Change: Operator.

Speaker Change: Okay.

Speaker Change: Thank you we will now begin the question and answer session. If you would like to ask a question. Please press star one on your telephone keypad to Asia and China.

Wendy: It's a very difficult market backdrop.

Wendy: It is this share the belief that positions us well as we strengthen our foundation for the future.

Wendy: We are serving a large and growing cell analysis market.

Speaker Change: We will pause for just a moment to compile the Q&A roster.

Wendy: Great leader.

Wendy: We continue to make thoughtful investments in our product pipeline and our service teams to drive growth and innovation and to strengthen our competitive position.

Speaker Change: Okay.

Speaker Change: Your first question comes from the line of Jeff <unk> with Morgan Stanley. Your line is open.

Jason: Hi, This is Jason offered tejas, thank you for taking our questions.

Wendy: Our strong balance sheet underpins, our foundation, which provides us with options and further flexibility in the future.

Yvonne: Your next question comes from the line of Mad Skies with Goldman Sachs. Hi, this is Yvonne from ADD. Thanks for taking my questions.

Speaker Change: Tariffs they've been a key focus for our investors.

Speaker Change: So it sounds <unk>, but just wanted to confirm should we expect any gross margin impact because of the recent tariff policy.

Wendy: We have a clear roadmap to expand our market leadership position in scale analysis.

Wenbin Jiang: So the first one on the Aurora cell sorter, what drove the double-digit growth there, and are there any specific end markets you would call out that may be differentiated versus your other instruments? I think we are seeing nice growth across all territories for our cell sorters. Part of the reason is clearly we see the benefit of Cytek sorter matches very well with our analyzer now already and widely being adopted by both academic and industry users, and this matching of the panels between Cytek sorter and Cytek analyzer clearly demonstrated the benefits for our users and made it very easy for them.

Wendy: These powerful attributes provide us with confidence in our long term objective of delivering sustainable growth and profitability.

Speaker Change: I Misheard I believe you said like Hi, Tec could potentially use some of your current available inventory to provide a buffer but.

Speaker Change: That is just temporary so I was wonder if you could quantify like a gross margin impact.

Wendy: I want to thank everyone for joining today's call and we will now open it up for questions.

Speaker Change: Current.

Speaker Change: <unk> a tariff policy and then you talked about some supply chain. Michigan's I don't believe I heard you talk about pricing so as pricing, sometimes sci-tech could turn to also ask that.

Wendy: Operator.

Wendy: Okay.

Speaker Change: Thank you we will now begin the question and answer session. If you would like to ask a question. Please press star one on your telephone keypad duration.

Speaker Change: And again to the tariffs and I guess, the third part would be.

Wendy: Thank you.

Speaker Change: Currently 125% tariffs from China and U S. Exports. So obviously, it's very hard to sell any products. There I'm wondering like how much of the 2025 revenue guidance cut could be because of the dynamics like the inability to sell.

Wendy: We will pause for just a moment to compile the Q&A roster.

Wenbin Jiang: So that's one reason. The second part is clearly the performance of our cell sorters and has been very well demonstrated and many of our users can easily go with our sorters directly and go beyond So this is something they would like to see. And so even under today's, we know, the tight budget situations, they see the benefits and they are jumping to Cytek technology. Okay, great. Thank you.

Okay.

Speaker Change: Your first question comes from the line of Jeff <unk> with Morgan Stanley. Your line is open.

Speaker Change: Your products in China. Thank you.

Speaker Change: Okay.

Jason: Hi, This is Jason on for pages. Thank you for taking our questions.

Speaker Change: Trying to take those in order.

Speaker Change: Tariffs they've been a key focus for our investors.

Speaker Change: So that.

Speaker Change: It is important to understand that we have established manufacturing facilities that are all <unk>.

Speaker Change: It sounds <unk> I just wanted to confirm should we expect any gross margin impact because of the recent tariff policy.

<unk> and shipping product.

Speaker Change: I Misheard I believe you said like Hi, Tec could potentially use some of your current available inventory to provide a buffer, but obviously that is just temporary. So I was wondering if you can quantify like.

Speaker Change: In three regions.

Speaker Change: The us Singapore, which is a new facility.

Wenbin Jiang: And then another one on phasing. You noted that you expected growth would be back half-loaded this year. What's driving this assumption, and is there any specific end market you expect to improve as we move throughout the year? There's two factors. One is that typically our second half of the year represents more than 50% of total sales, so it's you know, generally, usually somewhere in the mid 50s. So that's, that's point one. And that's just a function of the buying patterns of our customers. They tend to buy more, particularly in the fourth quarter than than in the first quarter, first quarter tends to be a light quarter, fourth quarter.

Speaker Change: Wuxi China.

So.

Speaker Change: Gross margin impact.

Primary strategy for managing tariffs is what we call region for region manufacturing, so we make product.

Speaker Change: The current.

Speaker Change: <unk> a tariff policy and then you talked about some supply chain. Michigan's I don't believe I heard you talk about really about pricing so as pricing, sometimes sci-tech could turn to ASO as a.

Speaker Change: For sale and in particular region.

Speaker Change: In the region that would be least impacted by tariffs so.

Speaker Change: And again to the tariffs and I guess, the third part would be there.

Speaker Change: Making product for Asia in Europe in Asia, and U S product.

Speaker Change: Cost of sales in the U S in the U S.

Speaker Change: Obviously, we can't do that.

Speaker Change: 100%.

Speaker Change: <unk> products in China. Thank you.

Speaker Change: But.

Speaker Change: We are able to mitigate a substantial portion of the potential tariff liability that way.

Speaker Change: Okay.

Speaker Change: Let me.

Speaker Change: Try to take those in order.

Speaker Change: The other thing that we can do is reorganized where we source components from.

Speaker Change: So that.

Wenbin Jiang: significantly more active. We don't, obviously, there are some new uncertainties in the market environment. We, you know, can't We can't predict the future with respect to overall economic growth and the broader market. But beyond that, we don't see anything that would suggest... that there's going to be a fundamental shift or difference in that normal quarterly pattern. So that's point one. And then point two is that. The impact that we've seen on the first quarter has been, clearly there's been some signaling of direct reductions in funding, but to a large part it's been the driver of reduced spending has been uncertainty about what the future may hold.

Speaker Change: It is important to understand that we have established manufacturing facilities that are all producing and shipping product.

Speaker Change: And then thirdly, we are.

Speaker Change: Recovering some costs from customers.

Speaker Change: Through through surcharges.

Speaker Change: In three regions.

Speaker Change: And so those are the strategies for dealing with.

Speaker Change: The U S, Singapore, which is a new facility.

Speaker Change: Tariffs.

Speaker Change: In Wuxi, China.

Speaker Change: We don't think that that will have.

Speaker Change: So.

Speaker Change: Primary strategy for managing <unk>.

Speaker Change: Any significant impact on al.

Speaker Change: On our revenues.

Speaker Change: Tariffs is what we call region for region manufacturing, so we make product.

Speaker Change: In.

Speaker Change: In 2025.

Speaker Change: We.

Speaker Change: In for sale and in particular region.

Speaker Change: And when I say that on obviously, putting to one side.

Speaker Change: In the region that will be least impacted by tariffs so making product for.

Speaker Change: Certainties created by.

Speaker Change: The economic and market environment that we're in.

Speaker Change: For Asia in Europe in Asia, and U S product.

Speaker Change: But in terms of tariffs specifically.

Speaker Change: Cost of sales in the U S.

Speaker Change: Don't think that will have an impact in terms of gross margin. The impact I think is will be fairly limited.

Speaker Change: Obviously, we can't do that.

Speaker Change: 100%.

Speaker Change: But.

Speaker Change: We are able to mitigate a substantial portion of the.

Speaker Change: And in.

Speaker Change: In the range of 1% to 3%.

Speaker Change: And in that regard.

Speaker Change: Potential tariff liability that way.

Speaker Change: We would expect as I mentioned in my remarks that gross margin will improve.

Speaker Change: The other thing that we can do is reorganized where we source components from.

Wenbin Jiang: It's not unreasonable to expect that as we get further into the year, that our customers' individual funding situations will be clearer and that some of that uncertainty might lessen. So I think that's also an overlay of how we think about it, but I also want to come back to this point that our revenue outlook is a function of, is formulated based on three different revenue streams, service, where we think that the installed base and the usage and activity of our systems is going to drive continued growth, reagents, where we've been seeing nice, solid growth trends.

Speaker Change: And then thirdly, we are.

Speaker Change: For the ensuing quarters.

Speaker Change: Recovering some costs from customers.

Speaker Change: Cause.

Speaker Change: We expect that.

Speaker Change: Through through surcharges.

Speaker Change: That revenues will follow typical seasonal pattern, where there'll be stronger in Q2, three and four.

Speaker Change: And so those are the strategies for dealing with.

Speaker Change: The tariffs, we we don't think that that will have.

Speaker Change: And.

Speaker Change: With higher revenues.

Speaker Change: Any significant impact on al.

Speaker Change: We will see a benefit.

Speaker Change: On our revenues.

Speaker Change: At the gross margin line.

Speaker Change: In <unk>.

Speaker Change: Did I cover all your questions.

Speaker Change: In 2025.

Speaker Change: We.

Speaker Change: Yes, most of it and then a third part just about a 125% tariffs from China and U S. Exports are you still able to sell your products in China. Thank you.

Speaker Change: And when I say that on obviously, putting to one side.

Certainties created by.

Speaker Change: The economic and market environment that we're in.

Speaker Change: We are able to sell products in China, absolutely, but that's the way that we deal with that.

Speaker Change: But in terms of tariffs specifically.

Speaker Change: Tariff is.

Speaker Change: Don't think that will have an impact in terms of gross margin. The impact I think is will be fairly limited.

Speaker Change: Through a region for region manufacturing, so obviously products sold in China don't incur tariff.

Wenbin Jiang: You know, those revenue streams should continue to see steady growth, and then the seasonal variation and the, you know, lessening uncertainty is primarily going to affect the instrument portion of our business. Yeah, the recurring revenue from service and regions have now already exceeded 30% of our total revenue. Up from 26% a year ago to $231, and that recurring portion is growing at $17, so that should continue to grow at similar rates. The service revenue growth rate, just as the installed base increases, that's going to increase slightly, but that's an effect that will take some years.

Speaker Change: And in the range of 1% to 3%.

Speaker Change: If the manufacturing in China are often manufactured in Singapore.

Speaker Change: And in that regard.

Speaker Change: Great. Thank you for the color on that.

We would expect as I mentioned in my remarks that gross margin will improve over the ensuing quarters.

Speaker Change: If I may ask just a follow up so as the academic government end market. It seems like the policy situation just gotten worse since your last guidance for Q4 seeing significant disruption government funding at universities with some of the country's largest research budgets.

Speaker Change: Cause.

Speaker Change: <unk>.

Speaker Change: We expect that.

Speaker Change: Revenues will follow the typical seasonal pattern, where there'll be stronger in Q2, three and four.

Speaker Change: Like a proposed 40% cut in the proposed.

Speaker Change: Proposed 2026.

Speaker Change: Our budget to the NIH. So I'm just wondering like how are you thinking about like the potential risks.

Speaker Change: And.

Speaker Change: With higher revenues.

Speaker Change: We will see a benefit.

Speaker Change: To your 2025 guide and.

Speaker Change: At the gross margin line.

Speaker Change: What was your overall outlook for this end market like do you think maybe like minus mid single digit decline could be reasonable. Thank you.

Speaker Change: Did I cover all your questions.

Speaker Change: Yeah, most of it and then a third part just about a 125% tariffs from China and U S. Exports are you still able to sell your products in China. Thank you.

Speaker Change: We look the uncertainties associated with the.

Speaker Change: We are able to sell products in China, absolutely, but that's the way that we deal with that.

Speaker Change: With University funding in the U S.

Wenbin Jiang: Great, thank you.

<unk> factored into our revised guidance, that's one of the.

David Westenberg: Your next question comes from the line of David Westenberg with Piper Sandman. Your line is open. Hi, this is John for Dave. Thanks for taking the question. So, could you just comment on whether or not you're seeing any of your competitors raising prices due to tariffs? And also, could you give any color on your R&D spending? Are you looking more into imaging or spectral for new product innovation?

Speaker Change: Tariff is.

Speaker Change: New issues that caused us to.

Speaker Change: Through a region for region manufacturing, so obviously products sold in China don't incur tariff.

Speaker Change: To come.

Speaker Change: Come out with this revised guidance.

Speaker Change: So.

Speaker Change: If the manufacturing in China are often manufactured in Singapore.

Speaker Change: The short answer to your question is it's factored into what we've told you about rhythm revenue expectations.

Speaker Change: Great. Thank you for the color on that.

Speaker Change: If I may ask just a follow up so as the academic government end markets. It seems like the policy situation just might gotten worse since your last guidance for Q4, we're seeing significant disruption government funding at universities or some of the country's largest research budgets.

Speaker Change: I would make a couple of points one is that.

Speaker Change: More than 50% of our revenue is outside the United States.

Speaker Change: So obviously.

Speaker Change:

Speaker Change: That revenue isn't affected by U S University funding.

Wenbin Jiang: On the pricing side, I think still in the early stage, I think we do see a report talking about passing around some of the tariff cost over to the customers, but we still wait to see how it's going to impact the overall market situation. With regarding to R&D, we continue to spend between 15% to 20% of our revenue to R&D and to drive new products, and imaging clearly is one of the directions of the company. which we are working on within the R&D department. OK.

Speaker Change: Like a proposed 40% cut in the.

Speaker Change: Proposed 2026.

Speaker Change: Our budget to the NIH. So I'm just wondering like how are you thinking about like this does potential risks.

Speaker Change: And then.

Speaker Change: Thirdly, and most importantly, as we think about our revenue in three buckets.

Speaker Change: To your 2025 guide and.

Speaker Change: Service, which is growing strongly.

Speaker Change: And where does your overall outlook for this end market like do you think maybe like minus mid single digit decline could be reasonable. Thank you.

Speaker Change: Reagents.

Speaker Change: Which also saw.

Speaker Change: So nice growth in.

Speaker Change: Q1, particularly in the U S and EMEA.

Speaker Change:

Speaker Change: Look the uncertainties associated with the.

Speaker Change: And then the instrument portion of our revenue is the one that's most impacted by.

Speaker Change: With University funding in the U S.

Speaker Change: Issues like the one that you mentioned.

Speaker Change: Factored into our revised guidance.

Speaker Change: One of the.

Speaker Change: But the other two.

Speaker Change: New issues that caused us to.

Speaker Change: Revenue sources of revenue streams are.

Speaker Change: To come.

Speaker Change: Come out with this revised guidance.

Speaker Change: They are not.

Speaker Change: Not particularly affected by.

Speaker Change: So.

Speaker Change: U S.

Speaker Change: The short answer to your question is it's factored into what we've told you of that rhythm revenue expectations.

Chad Wiatrowski: Your next question comes from the line of Chad Wiatrowski with TD Cowen. Your line is open. Hey guys, this is Chad Wiatrowski on for Brendan. Just on the share repurchases this quarter, obviously the balance sheet is still healthy. How do you sort of reconcile doing share repurchases versus like M&A or organic investment and what sort of plan throughout the remainder of the year? Uh, we, um... We plan to do both share repurchase and. have capital available for M&A. So we think we have plenty of cash available to do both. Um.

Speaker Change: University funding issues.

Speaker Change: But OLED said, we are continuing to sell instruments to U S universities here in the second quarter.

Speaker Change: I would make a couple of points one is that.

Speaker Change: More than 50% of our revenue is outside the United States.

Speaker Change: Yes.

Speaker Change: So obviously.

Speaker Change: That revenue isn't affected by U S University funding.

Speaker Change: Your next question comes from the line of Matt <unk> with Goldman Sachs. Your line is open.

Speaker Change: And then.

Speaker Change: Hi, This is <unk> on for Matt. Thanks for taking my questions. So the first one on the Aurora Astellas order what growth what drove the double digit growth there and are there any specific end markets you would call out that may be differentiated versus your other instruments.

Speaker Change: Probably most importantly is we think about our revenue in free buckets, service which is growing strongly.

Speaker Change: Reagents, which also saw some nice growth in Q1 particularly in U.S. and Amir, and then the instrument portion of our revenue is the one that's most impacted.

Speaker Change: I think we are seeing nice growth across all territories for ourself sort us part of the reason.

Chad Wiatrowski: With respect to specific share repurchase plans, I can't say much more than... Thank you for the new authorization. Last year, we purchased $10.5 million worth of shares in the first quarter, approximately $2.1 million. So that's basically all I can say for the time being. In terms of capital allocation priorities, our plan is to have capital available to do both. Again, if you would like to ask a question, press star 1 on your telephone.

Speaker Change: Clearly, we see the benefit of side of the Sada matches very well with our annualized are now already.

Speaker Change: She's like the one that you mentioned, but the other two revenue sources or revenue streams are...

Speaker Change: And why do they being adopted by both academic and industrial users and.

Speaker Change: This matching of the.

No, not particularly affected by US university funding issues.

Speaker Change: Panels between <unk>, <unk> and <unk> analyzer, clearly demonstrated the benefits for our users have made it very easy for them. So thats. The one in the second part is clearly the performance.

Speaker Change: So, all that said, we are continuing to sell instruments to US universities here in the second quarter.

Speaker Change: Our sale of photos and.

Speaker Change: <unk> has been very well demonstrated and the.

Speaker Change: Many of our users can easily go with our photos correctly.

Speaker Change: Your next question comes from the line of Matt Skies with Goldman Sachs. Your line is open.

Beyond the 40 color panels and so.

Speaker Change: So this is something that I would like to see and so even under today's we know is a tight budget situations they see the benefits.

Andrew Cooper: Your next question comes from the line of Andrew Cooper with Raymond James. Your line. Hey, everyone, this is Noah for Andrew.

Speaker Change: Jumping to <unk> technology.

Speaker Change: Okay, great. Thank you and then another one on phasing you noted that you expected growth would be back half loaded this year, what's driving this assumption and is there any specific end markets you expect to improve as we move throughout the year.

Speaker Change: I think we are seeing nice girls across all territories for our self-sorters.

Wenbin Jiang: First question, just wanted to get a feel for what are customers saying about the Cytek news? Are you seeing a lot of interest? I just want to get an idea of what you're seeing in that new product Cytek MUTE being a new product line and it will support gene and cell therapy and this is a new product currently still in the sampling and evaluation stage but we do have some early products based on the technology acquired from Luminex and that's the part has been selling very well and normally they match certain needs, for example, like cell counting and live dead cells, that kind of testing.

Speaker Change: Two factors one is that typically al.

Speaker Change: No.

Speaker Change: and widely being adopted by both academic and industry users. And this matching of the panels between Cytek Soda and Cytek Analyze clearly demonstrated the benefits for our users,

Speaker Change: Second half of the year represents.

Speaker Change: More than 50% of total sales so it's.

Speaker Change: Generally usually somewhere in the mid fifties.

So that's 0.1 and Thats, just a function of the buying patterns of our customers there.

Speaker Change: So that's one of the second part is clearly the performance of our sales orders.

Speaker Change: They tend to buy more particularly in the fourth quarter then.

Speaker Change: and has been very well demonstrated, and many of our users can easily go with our soldiers directly and go beyond 40 color panels.

Speaker Change: Then in the first quarter first quarter tends to be a one quarter fourth quarter.

Speaker Change: Significantly more active.

Speaker Change: Obviously, there are some new uncertainties in the market environment.

Speaker Change: So this is something they would like to see and so even under today we know the tight budget situations they see the benefits and they are jumping to Cytek technology.

Wenbin Jiang: But Micromuse, the one we're going to launch, will add new features, new functionalities to support new applications and enable us to enter into a new market in the meantime to help drive our region revenue as well.

Speaker Change: We.

Speaker Change: Got it.

Speaker Change: Sure Tom.

Speaker Change: Predict the future with respect to overall economic growth.

Speaker Change: A broader market.

Speaker Change: But beyond that we don't see anything that would suggest.

Speaker Change: Okay, great. Thank you. And then another one on phasing. You noted that you expected growth would be back half loaded this year. What's driving this assumption? And is there any specific end market you expect to improve as we move throughout the year? Yeah.

Speaker Change: That is going to be a fundamental.

Wenbin Jiang: Awesome.

Wenbin Jiang: And then maybe if I can just get one more, you know, you mentioned pharma biotech and I think the CRO market, postponing orders, just kind of want to get an idea of what you're seeing now that we're about a week into May. Is there a little bit more optimism? Is it still just about the same as April? And then also, how does that compare to what you're hearing from your academic and government customers as Look, we incorporated everything that we're seeing into our quarterly guide, sorry, into our annual guidance. So I also mentioned that we expect to see a typical seasonal pattern between the quarters.

Speaker Change: Shift or difference in that.

Speaker Change: <unk>.

Speaker Change: Normal quarterly pattern.

Speaker Change: The two factors. One is that typically our second half of the year represents a more than 50% of total sales.

So that's 0.1.

Speaker Change: <unk>.

Speaker Change: And.

Speaker Change: And then 0.2 is that.

Speaker Change: The.

Speaker Change: <unk> that we've seen on the first quarter.

Speaker Change: <unk> has been clearly there has been.

Speaker Change: You know, generally usually somewhere in the mid-50s, so that's point one, and that's just a function of the buying patterns of our customers.

Speaker Change: Some signaling of direct reductions in in.

Speaker Change: Funding, but to a large part it's been.

Speaker Change: The driver of reduced spending has been uncertainty about what the future may hold.

Speaker Change: Not unreasonable to expect that as we get further into the year that.

significantly more active.

Our customers funding individual funding situations, we'll be clear of that.

We doubt, obviously, there are some new uncertainties in the market environment.

Wenbin Jiang: So there's nothing that we've seen so far in May that would be at odds with that. But we don't typically comment on month by month or give quarterly guides. But just suffice it to say that typically our Q2 is stronger than our Q1. I think as we've mentioned in the past, we are primarily a third month company. The significant majority of our sales for each quarter happens in the third month of the quarter. So obviously, we haven't seen June yet. And so any, you know. So the evidence around second quarter so far is limited but it's consistent with the supports the views that we've expressed here.

Speaker Change: But some of that uncertainty.

Speaker Change: So I can't predict the future with respect to overall economic growth and the border market, but beyond that we don't see anything that would suggest.

Speaker Change: Lesson.

Speaker Change: And.

Speaker Change: So I think Thats also.

Speaker Change: An overlay of how we how we think about it.

I also want to come back to this point that that our revenue outlook is is a function of.

Speaker Change: that there's going to be a fundamental shift or difference in that normal quarterly pattern. So that's point one.

Speaker Change: It is formulated based on three different revenue streams service.

Speaker Change: Where we think that the installed base and the usage and activity of our system is going to drive continued growth.

Speaker Change: The impact that that we've seen on the first quarter has been clearly there's been...

Agents, where we've been seeing nice.

Speaker Change: Solid growth trends.

Speaker Change: So those.

Speaker Change: some signaling of direct reductions in funding, but to a large part it's been the driver of reduced spending has been uncertainty about what the future may hold.

Speaker Change: Those revenue streams should continue to see steady growth and then the.

Speaker Change: The.

The seasonal variation in the <unk>.

Wenbin Jiang: Pharma customers versus academic and research. I think you'll see from our 10-Q that revenue from those two sectors was down by a similar amount. So, you know, we saw Cautious. from the pharma industry. There are some macro reasons for that related to tariffs and drug pricing concerns and so on. But generally speaking, I would say that the You know, we haven't seen much different other than just a more cautious tone around Capital Spending, but you know, our systems. Big Pharma still has a strong preference for our systems because they're uniquely capable of being harmonized. And that's very important to them.

Speaker Change: Lessening uncertainty.

Speaker Change: It's primarily going to affect the instrument portion of that business.

Speaker Change: Not unreasonable to expect that as we get further into the year, that our customers funding individual funding situations will be clearer and that some of that uncertainty might might lessen.

Speaker Change: Nonrecurring revenue from service and regions have now already exceeded 30% of our total revenue up from 26% a year ago to $2 31.

Speaker Change: The recurring portion is growing 17, so that should.

and so I think that's also.

Speaker Change: No.

and Ovalay of how we think about it this.

Speaker Change: Continue to.

Speaker Change: To grow at similar rates.

Speaker Change: The service revenue growth rate.

Just as the installed base increases.

Speaker Change: In a moderate slightly but that's something that's an effect that will.

Speaker Change: Take some meetings.

Speaker Change: You know, where we think that the installed base and the usage and activity of our systems is going to drive continued growth. The agents where we've been seeing nice solid growth trends.

Speaker Change: Great. Thank you.

Okay.

Speaker Change: Your next question comes from the line of David Whiston with Piper Sandler Your line is open.

Wenbin Jiang: And we continue to see multiple system orders from Big Pharma.

John: Hi, This is John on for Dave Thanks for taking the questions.

John: So could you just comment on whether or not youre seeing any of your competitors raising prices due to tariffs and also.

Speaker Change: the seasonal variation and, you know, lessening uncertainty, primarily going to affect the instrument portion of our business.

John: Could you give any.

John: Color on your R&D spending are you looking more into imaging or spectral for new product innovation. Thank you.

Speaker Change: Yeah, the Recurring Revenue from Service and Regions have now already exceeded 30% of our total revenue. Up from 26% a year ago to 31.

Operator: And seeing no further questions at this time, that does conclude today's conference call. Thank you all for joining, and you may now disconnect.

John: On the pricing side of things still in the early stage.

John: I think.

John: We do see report talking about passing on some of the tariff cost over total customers.

Speaker Change: and that recurring portion is growing 17, so that should continue to...

Speaker Change: to grow at similar rates. The service revenue growth rate, just as the installed base increases, you know, that's going to more slightly, but that's something that's an effect that will, you know, take some unions to grow.

John: So, but we still wait to see how it's going to impact the overall market situation.

John: With regarding to R&D, we continue to spend between 15% to 100% of our revenue to R&D and to drive new products imaging liquidity is one of the directions of the company.

Great, thank you.

John: Which we are working on within the R&D Department.

John Freechack, John Freechack, John Freechack, John Freechack

Speaker Change: Your next question comes from the line of David Westenberg with pipe resentment. Your line is open.

Okay. Thank you.

Speaker Change: Your next question comes from the lack of chat.

Speaker Change: Hi, this is John on for Dave. Thanks for taking the questions. So could you just comment on whether or not you're seeing any of your competitors raising prices due to tariffs and also, could you give any color on your R&D spending? Are you looking more into imaging or spectral for new product innovations? Thank you.

Scott: Yes, Scott.

Scott: With TV.

Speaker Change: Your line is open.

Chad: Hey, guys. This is Chad why transplant for Brendan Smyth.

Speaker Change: Just on the share repurchases this quarter, obviously the balance sheets. So healthy how do you sort of reconcile doing share repurchase purchases first versus like M&A or organic investment and what's sort of the plan throughout the remainder of the year.

and Paul Goodson.

Speaker Change: on the pricing side, I think still in the early stage, and I think...

Chad: Okay.

Chad: We.

Chad: We we plan to do both share repurchase.

Chad: And.

Have capital available for M&A so.

Speaker Change: So, but we still wait to see how it's going to impact the overall market association.

Chad: We think we have plenty of cash available to do both.

Chad: With respect to specific share repurchase plans I can't say much more than that.

Chad: Good.

Chad: <unk>.

Chad: Late last year.

which we are working on within the R&D department.

Chad: We purchased $10 $5 million worth of shares in the first quarter.

Okay, thank you.

Chad: Approximately $2 1 million.

Paul Goodson: Good morning, everyone. I'm Paul Goodson. I'm a lawyer. I'm here to talk about the American Civil Rights Act. This was passed in 2011. It was passed by the US Senate in 2012. It was passed by the House of Representatives in 2014. It was passed by the House of Representatives in 2015. It was passed by the House of Representatives in 2016.

Chad: Okay.

Speaker Change: The next question comes from the line of Chad. Wiatrowski with TD Cowen. The line is open.

Chad: That's basically all I can say.

Chad: For the time being.

Chad: In terms of capital allocation priorities.

Speaker Change: Hey, guys, this is Chad, and I trust him for Brendan Smith. Just on the sharey purchases this quarter, obviously the balance sheets still healthy. How do you reconcile doing sharey purchases versus like M&A, or again, a investment, and what sort of plan throughout the remainder of the year?

Chad: Our plan is to have capital available to do both.

Chad: Okay.

Chad: Again, if you would like to ask a question press star one on your telephone keypad.

Speaker Change: Your next question comes from the line of Andrew Cooper with Raymond James Your line is open.

Speaker Change: have capital available for M&A, so we think we have plenty of cash available to do both.

Chad: Okay.

Speaker Change: Hey, everyone. This is now on for Andrew first question just wanted to get a feel for what are customers, saying about the sidekick news are you seeing a lot of interest I just want to get an idea of what youre seeing in that new product launch.

Speaker Change: With respect to specific Sherry Purchase plans, I can't say much more than...

Chad: Yes.

Speaker Change: White last year, we purchased ten and a half million dollars worth of shares in the first quarter, approximately 2.1 million.

Chad: Yes.

Chad: Being a new product line to support gene and cell therapy.

This is a new product currently still in the sampling.

You know, that's basically all I can say for a time being.

Chad: Validation stage, but we do have some early products.

Chad: Based on the.

Speaker Change: in terms of capital allocation priorities, you know, our plan is to have capital available to

Chad: Technology acquired upon Illumina X and that's the part has been selling very well and.

Chad: Nominate them match certain.

Chad: Needs for example, exhale counting and.

Chad: Life's debt sale that kind of testing.

Speaker Change: Again, if you would like to ask a question, press style one on your telephone keypad.

Speaker Change: But micro mills, the one web intellectual will add new features and new functionalities to support new application enabled us.

Speaker Change: Your next question comes from the line of Andrew Cooper with Raymond James, your line is open.

Speaker Change: Entering into a new market in the meantime to help drive our religion.

Speaker Change: Revenue as well.

Speaker Change: Hey everyone, this is Noah on For Andrew. First question, just wanted to get a feel for what are customers saying about the Cytek Muse? Are you seeing a lot of interest? I just want to get an idea of what you're seeing in that new product launch.

Speaker Change: Awesome and then maybe if I can just get one more.

Speaker Change: <unk> pharma biotech and I think the CRM market postponing orders.

Speaker Change: Just kind of wanted to get an idea of what youre seeing now that we're about a week in the may.

Speaker Change: Is there a little bit more optimism is it still just about the same as April and then also how does that compare to what youre hearing from your academic and government customers as it relates to funding.

Speaker Change: Yeah, Cytek Mews has been a new product to learn and is to support Gene and his fellow people, and this year is...

Speaker Change: Locally.

Speaker Change: <unk>.

Speaker Change: We incorporated.

Thing that we're seeing into our quarterly guide.

Speaker Change: Sorry <unk>.

Speaker Change: Our annual guidance.

Speaker Change: So.

Speaker Change: I've also I also mentioned.

That we expect to see.

Speaker Change: A typical seasonal pattern between the quarters. So theres nothing that we've seen so far in may that would be at odds with that.

Speaker Change: Anthony into a new market in the meantime to help drive our reagent revenue as well.

Speaker Change: But we don't typically comment on months by months he'll give quarterly guidance, but just so.

Speaker Change: Suffice it to say that typically al Q2 is stronger than our Q1.

Speaker Change: Awesome, and then maybe if I can just get one more, you know, you mentioned pharma, biotech, and I think the CRO market, postponing orders, just kind of want to get an idea of what you're seeing now that we're about a week into May. Is there a little bit more optimism? Is it still just about the same as April? And then also, how does that compare to what you're hearing from your academic and government customers as it relates to funding?

Speaker Change: I think as we've mentioned in the past we are primarily a third month company, though.

Speaker Change: The significant majority of the sales for each quarter happens in the third month of the quarter. So obviously, we haven't seen June yet.

Speaker Change: And so any.

Speaker Change: Hello.

Speaker Change: The evidence around second quarter, so far is limited, but it's consistent with the.

Speaker Change: I look, we incorporated everything that we're seeing into our quarterly guide, sorry, into our annual guidance.

Speaker Change: And supports the views that that we've expressed here.

Speaker Change: Pharma customers versus academic and research.

So, I've also mentioned that, you know, we expect to see...

Speaker Change: You'll see from our 10-Q that.

Speaker Change: Net revenue from <unk>.

Speaker Change: Those two sectors was down by a similar amount so.

Speaker Change: We saw.

Speaker Change: Cautious.

So there's nothing that we've seen.

Spending environment from the pharma industry there.

Speaker Change: So far in May that would be at odds with that, but we don't typically comment on month by month we'll give quarterly guides, but just...

Some macro reasons for that related to.

Speaker Change: Tariffs and drug pricing concerns and so on.

Suffice it to save it typically, Al Q2 is…

Speaker Change: But generally speaking.

Speaker Change:

Stronger than our Q1. [inaudible]

Speaker Change: We haven't seen much different other than <unk>.

Speaker Change: I think as we've mentioned in the past, we're primarily a third month company, the significant majority of sales for each quarter happens in the third month of the quarter. So obviously, we haven't seen June yet, and

Speaker Change: Just a more cautious tone around.

Speaker Change: Our capital.

Speaker Change: Capital spending, but our systems.

Speaker Change: Big Big Pharma is still has a strong preference for our systems because.

Speaker Change: We are uniquely capable of being harmonized.

Speaker Change: And that's that's very important to them.

So, any, you know,

Speaker Change: So the evidence around second quarter so far is limited, but it's consistent with the...

Speaker Change: We continue to see multiple system orders from big pharma.

and supports the views that we've expressed here.

Speaker Change: Yes.

Speaker Change: Pharma Customers versus Academic and Research. I think you'll see from out 10Q that revenue from those two sectors was down by a similar amount. So, you know, we saw...

Speaker Change: Okay.

Speaker Change: And seeing no further questions at this time that does concludes today's conference call. Thank you all for joining and you may now disconnect.

cautious

Keppel Spending, but you know our systems...

Speaker Change: Big Pharma still has a strong preference for our systems because...

Speaker Change: who are uniquely capable of being harmonized and that's very important to them and we continue to see multiple system orders from Big Pharma.

William McCombe: Paul Goodson, William McCombe, Paul Goodson, William McCombe, Paul Goodson, William McCombe,

William McCombe: and seeing no further questions at this time, that concludes today's conference call. Thank you all for joining and you may now disconnect.

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Speaker Change: If you find this educational, leave a like, comment and subscribe, thanks for watching

Music Music Music Music Music Music

Speaker Change: Paul Goodson, William McCombe, Paul Goodson, William McCombe, Paul Goodson, William McCombe,

Speaker Change: The Guardian and his newtitle, The Walking Dead Man The War in Britain For more gigs, visits Wumblin.com Cast Authors Star Ratings

and William Dittard.

[music]

Thank you for watching!

Speaker Change: Paul Goodson, William McCombe, Paul Goodson, William McCombe, Paul Goodson, William McCombe,

Paul Goodson, John Freechack, John Freechack, John Freechack, John Freechack, John Freechack,

Music Music Music Music Music Music

Speaker Change: Thank you for standing by, at this time, I would like to welcome everyone to the Sykes, Biosciences 1st quarter 2025 earnings conference call. All lines have been placed on YouTube to prevent any background noise.

Speaker Change: After this because for marks, there will be a question and answer session. If you would like to ask a question during these times, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again.

Speaker Change: I would not like to turn the conference over to Paul Goodson, head of investor relations. Please go ahead, sir.

Paul Goodson: Thank you, operator. Earlier today, Sykes, Bio Sciences released financial results for the first quarter-ended March 31st, 2025.

Speaker Change: If you haven't received this news release, or if you'd like to be added to the company's distribution list, please send an email to investors at www.cytekbio.com

Speaker Change: The copy of the news release is also available on the Investor Relations section of Cytek's website at investors.cytekbio.com

Speaker Change: Joining me today from Cytek are Wenbin Jiang, CEO , and Bill McCombe, CFO . Please note that we will be referencing a slide presentation during the call today that has been posted to the Destrocession of our Corporate Website.

Speaker Change: As a reminder, we will make statements during the call that are forward looking statements within the meeting of the federal securities laws including statements regarding Cytek's

Speaker Change: 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 in these statements.

Speaker Change: Additional information regarding these risks and uncertainties appears in our slide presentation in the section entitled, Forward Looking Statements in the press release site tech issue today and in site tech's filings with the FCC.

Speaker Change: This call will also include a discussion of certain financial measures that are not calculated in accordance with generally accepted accounting principles.

Speaker Change: Additional information regarding our use of non-GAAP financial measures, including reconciliation to the most directly comfortable GAAP financial measures, may be found in our slide presentation, and in today's press release.

Speaker Change: While the company believes these non-GAF financial measures provide useful information for investors, the presentation of this information is not intended to be considered an isolation or as a substitute for the financial information presented in accordance with GAF.

Speaker Change: This conference call contains the fifth information and is accurate only as of the live broadcast May 8, 2025.

Speaker Change: These are typically all-day meetings where Cytek scientists and users of Cytek's instruments meet to discuss research initiatives, advances in the field, and use cases for Cytek's products.

Speaker Change: The next meeting will be in La Jolla on May 15th at the Estancia Hotel.

Speaker Change: In addition to Sykes user group meetings this year, there will be a variety of industry and academic conferences, meetings and seminars.

Speaker Change: where we will be exhibiting Sykes products in the US and around the world.

Speaker Change: Well, these events are primarily geared to the scientific community. They may offer an opportunity to interact with users of our technologies to learn why Sykes' instruments are so highly valued by our customers.

Speaker Change: We have a limited number of spaces to accommodate members of the financial community, so if you are interested in attending any of these events, please contact me.

Wenbin Jiang: With that, I would like to turn the call over to Wenbin.

Thanks, Paul.

Welcome everyone, and thank you for your interest in Sykes.

Wenbin Jiang: John Freechack, I will discuss our performance during the first quarter, including factors impacting our business.

Wenbin Jiang: to provide an update on our 25th Outlook and share details on how we are navigating this dynamic

Wenbin Jiang: Next, I will provide highlights on how our progress in the quarter across our strategic priorities for 2020-25 before any recall over the bill for more detailed looks at our financials and our 2020 final outlook.

Starting with our first quarter review on slide three.

Wenbin Jiang: First quarter review in Sunday's Unified was $41.5 million, down 7.6% compared to the first quarter of

Wenbin Jiang: The year over year the current was driven many by weakness in instrument sales in the U.S. and a mere partially offset by strength in instrument sales in 8.10, the rest of the world region.

Wenbin Jiang: Joseph Ramney worldwide reached 13.3 million dollars and increase of 24% versus a year ago.

Wenbin Jiang: The gold in service revenue continued its strong performance and was driven by the expansion of our instrument in store-based and active usage of our food across a broad range of disciplines.

Cunning to slide, Paul.

Wenbin Jiang: diving into the underlying sectors towards the last month of the first quarter. We again see a broad base to slow down in ensuing orders across our US and near regions.

Wenbin Jiang: Among the academic and development customers in the US, instrument placement declined, driven by uncertainties, with academic funding from US part of the change.

Wenbin Jiang: In a year, tragic due to government funding priorities affected purchasing trends.

Wenbin Jiang: sales across our bulkhead farmer and the Seattle customer declined due to some orders being postponed to the certain quarters, and the customer buying decisions being influenced by the uncertainties across the industry due to the US policy environment.

Wenbin Jiang: Fure Grafaklet, we continue to benefit from a stronger demand environment for instruments in the APEC and in the rest of the world region, which include Canada and Latin America. Thank you very much.

Wenbin Jiang: Total revenue in APEX and the rest of the world's region together was $11.4 million, of 35.6% year over year.

Wenbin Jiang: While we are viewing social styles in China with a level of conservatism, we continue the full experience and increase in order in the first quarter related to the China stimulus program.

Wenbin Jiang: due to the recent change in the marketing environment as a result of these macroeconomics and the policy related factors.

Wenbin Jiang: We now anticipate three years from page 25 of revenue to be in the range of $1.6 to $2,210 million. We continue to express concerns on capital equipment spending in the US and near due to these conditions.

Bill Wilk provides more details on this outlook shortly.

Wenbin Jiang: while I will continue to offer it in a dynamic market environment. The Dutable Foundation we have built enables us to be agile and to drive faster forward through uncertain times.

Wenbin Jiang: We are serving a large and growing sale analysis market with our industry-leading sale analysis portfolio.

Wenbin Jiang: Robo's investigation and the critical first mover advantage we have in FSP technology.

Wenbin Jiang: More than 50% of our product sales are outside of the US.

Wenbin Jiang: To support our customers worldwide, we have established manufacturing operations in three countries, the US, China, and Singapore.

Wenbin Jiang: This manufacturing first thing enables region-for-region manufacturing and allows us to optimize product loads for any global health environment.

Wenbin Jiang: We saw the brief that having multiple manufacturing locations enhances the resilience of our supply chain, thereby ensuring more reliable and cost effective product availability for our customers.

Wenbin Jiang: I was now likely to update you on the progress our team has made across our course, strategic pillar, instrument, application, bioinformatics, and clinical, to solidify static position as a marketing leader in net share cell analysis solutions.

Speaker Change: Thank you for watching. Please subscribe to my channel. I hope to see you again soon.

starting with our core instruments on slide five.

Speaker Change: In the first quarter, we expanded our global footprint by 1515 instruments bringing Cytek's total

Speaker Change: In the first quarter, we also announced the launch of the Pytre Muse Micro-Sixon.

Speaker Change: The new microcell analyzer is an affordable option that simplifies close-by commentary while enhancing ease of use, precision and the birth determinacy.

Speaker Change: The latest instrument expands our state capabilities to drive adoption in new emerging markets, such as cell energy incentives, and drop discovery by enabling smaller labs and the resource-limited facilitates to access high-quality peroxide chemicals and a cost-effective price.

Speaker Change: while revenues were down in this Q1 condition before in both the Islamic and government and the Biopharmal Market Feminist.

Speaker Change: We, please, this was a large tribute for Mark and the weakness, rather than Mark the share of all.

Speaker Change: or competitive position as a leader in the FSP market sediments, the best show.

Speaker Change: We have established a significant commercial footprint and the brand identity in the US and a mere and are expanding our market leadership in APEC and in the rest of the world, rhythm.

Speaker Change: The larger info-the-base of high-planetary analyzer instruments we have built over time provides a beautiful foundation for joining your current revenue growth in our service and the

to expand our annual market and accelerate growth.

Speaker Change: We have made strategic investment to advance our product pipeline with new generations of products.

Speaker Change: from Middle-Avolitioners, including our Northern Rights Land and Wheels Micro-Systems.

Speaker Change: The deliverance of our product portfolio amid a challenging matter of economic backdrop is demonstrated by the 15% trading squalb money growth in our sales order unit placement and 17% TTN growth in Northern Lights units installed.

Speaker Change: Within our portfolio, Arora fell saw the lab new glue 15% year over year, and a Northern-Lighted W increased 6% year over year in the first quarter.

Nordomized research unit only sales group 8% year over yet.

Speaker Change: Nautilus, both O'Rourough, Soder, and Northern Life Instruments have continued the growth trend that we saw in the fourth quarter of the Dayton people.

Speaker Change: Consequently, these instruments raise the present growth across a diverse customer base offering comprehensive and a better solution tailored to meet their needs.

Moving to Bow over Matt, it sounds like 6. [inaudible]

Speaker Change: I'm pleased to report that the fighter cross continues to grow at a vital resource in the research community.

Speaker Change: Our main goal is to enable our customers to streamline their experiment work through our software tools which drive adoption and utilization of our self-analysis solutions and growth in our region and service businesses.

Speaker Change: We now have over 18,000 users, which grew by 2000 users in the first quarter of the room.

Speaker Change: This represents an average of about six users per inch to the Sykes FST instrument, which renovates the loyalty our users have to our product portfolio and demonstrates the

Speaker Change: The increase in site-to-crow users, the fact growth in the usage of our products and is electionally correlated with long-term decoding revenue growth drivers from our reagents and the service producers.

Pauline True, our Mexico Family, Applications.

Speaker Change: while we are in the early earnings with our legging benefits.

Speaker Change: We continue to believe that it has strong growth potential. We plan to drive growth by absolutely our new reagent cloud of introduction engine, which will expand our reagent offerings and

Speaker Change: The share of reagents we supply as a percentage of total reagent volumes used on our instruments is still at the onset of its growth trajectory.

Speaker Change: Ripley, there is a significant growth potential ahead as we continue serving our expanding install

Speaker Change: Improving our execution and delivery time to customers, leveraging the size of the cloud as a creation sales platform, and introducing new creation products and applications.

Speaker Change: Multiple A, I believe we have mutual and impression points with the current revenue, including the region and service revenue combined, leveraging our established and expanding install

Speaker Change: In the first quarter, we were pleased to see our relation self positively contribute to our current revenue rate as a percentage of our total revenue.

Speaker Change: Specifically, our Australian 12-month recurring revenue is steadily growing, representing 31% of our total revenue in the first quarter.

Up front, 26% a year ago. [inaudible]

Speaker Change: Further, our training 12 months, the training revenue grew 17% in the first quarter compared to the prior year. Long ago, we expect our training service and the reagent revenue to be

Speaker Change: turning left to clinical. We continue to believe the clinical market represents an attractive business opportunity for Sykes, and we have seen considerable growth in the EU and APEC for clinical application.

Speaker Change: in the EU. One academic hospital fully validated our minimal disease or MRT panel for leukemia in the informal and will begin implementing it in real routine clinical testing

Speaker Change: as a key attorney leader. This institution has also supported our outreach to other clinical sites

Speaker Change: Although I'm encouraged by our results despite challenging macro headwinds in the US and the US. We have areas of strength in high growth regions including Asia-Pacific and strength in our

Speaker Change: The lively install base we have built worldwide provides the basis for a long-term growth in our recurring services and the religion benefits and offers the opportunity to scale our

Speaker Change: I believe that we are well positioned to emerge from this period even stronger than we are today.

Navigin, our Industrial Leading Sales Analysis portfolio, and the strong business fundamentals.

Speaker Change: With that, I will now turn the call over to Bill for more details about our financials. Thanks, Wenbin, turning to Slide 7 and our first quarter financial results.

Speaker Change: Total revenue for the fifth quarter of 2025 was 41.5 million, a 7.6% decrease compared to the first quarter of 2024.

Speaker Change: Product revenue, which is insurance and reagents decreased 18% versus Q1 of 2024.

Speaker Change: This decrease was driven by a weaker instrument market in the U.S. and Amia.

Speaker Change: As Wenbin described earlier, this was primarily due to academic funding uncertainties in the US.

Speaker Change: Pressure on government budgets in the media causing delays in academic and research funding and a cautious capital spending environment in the biotech and farmer industries.

Speaker Change: Service revenue was a blind spot growing 24% versus Q1 of 2024.

Speaker Change: Garth and service revenue reflect continued expansion about stole base of instruments and active usage of our systems.

Speaker Change: Turning to our Geographic Market Performance, total US and a mere revenue declined 13% and 24% respectively, driven by lower instrument sales for the reasons I mentioned.

Speaker Change: On the other hand, Asia Pacific grew very strongly up 40% driven by a particularly strong growth in China.

Speaker Change: Other international markets, primarily Canada and Latin America, also grew strongly up a small base.

Speaker Change: We believe this growth reflects the strength of Sykes' brand and customer preference for our technology globally.

Speaker Change: Gap Gross Profit was 20.2 million for the first quarter of 2025, a decrease of 12% compared to the gross profit of 23 million in the first quarter of 2024. Gap Gross Module was 49% in the first quarter compared to 51% in the prior year.

Speaker Change: non-GAAP adjusted gross margin in the first quarter with 52%, compared to 55% in the prior year quarter. The declining gap in adjusted gross margin was primarily due to lower product revenues and higher manufacturing over him.

Speaker Change: This was offset by a higher service gross margin compared to a year ago.

Speaker Change: We expect quarterly gross margins to improve for the balance of the year as quarterly revenue increases consistent with typical seasonal patterns.

Speaker Change: Research and development expenses were 9.7 million to the first quarter, down 0.1 million from the first quarter of 2024.

Speaker Change: Sales and marketing expenses were $12.5 million for the first quarter, Quatt versus the first quarter of 2024.

Speaker Change: General and administrative expenses with $1.9 million for the first quarter, up $1.5 million from the first quarter of 2024, due to higher outside services and headcount expense.

Speaker Change: Wilson Operations was 15 million for the first quarter compared to the 10.7 million loss of operations in the prior year quarter.

Speaker Change: Gap Net Loss was 11.4 million in the first quarter compared to Gap Net Loss is 6.2 million in the

Speaker Change: versus 10.7 million a year ago, and a tax experience of 0.1 million versus a tax benefit of 2.8 million a year ago, offset by higher other income due to 1.3 million foreign exchange gaining in the current quarter compared to a 1.1 million FX loss in the prior year quarter.

Speaker Change: Adjusted either die, which excludes stock-based compensation and foreign currency impacts, decreased your loss of 3.3 million for the first quarter, give a lower gross profit compared to a loss of 0.7 million in Q1 of last year.

Speaker Change: Adjusted EBITDA included investment income of 2.3 million excluding this amount adjusted EBITDA loss was 5.5 million in Q1 compared to a loss of 2.6 million in Q1 of last year.

Speaker Change: We expect adjusted EBITDA to improve on a quarterly basis as revenues and gross margins increase consistent with typical seasonal patterns.

Speaker Change: Total cash and marketable securities decreased 12.3 million versus Q4 to 265.6 million as of March 31, 2025.

Speaker Change: The decline was primarily driven by our investment of 10.6 million to retouches shares during Q1.

Lastly, turning to our four-year guidance on page 8.

Speaker Change: As Wenbin described earlier, due to the significant change in our market environment since our last earnings call in late February

Speaker Change: We are revising our full year 2025 revenue outlook to a range of 196 million to 210 million representing overall growth of minus 2% to plus 5% over full year 2024, assuming no change

Speaker Change: Consistent with our typical seasonal pattern and especially given the current uncertainties in the market and geopolitical environment, we expect this growth to be back and loaded to the second half of 2025.

Speaker Change: As when, in further notice, our market leadership position remains strong, and we believe we will perform well relative to the overall flow-side tomatry market.

Speaker Change: A strong balance sheet also gives it the ability to continue investing for growth. With that, I'll turn it back over to Wenbin.

That's Bill, turning to Flyman.

Speaker Change: I want to take the moment to thank our team at Sykes for their dedication to our mission and the overall resilience amidst a very difficult market patchwork.

Speaker Change: It is this shared belief that positions us well as we send in our foundation for the future.

Speaker Change: We are serving a large and growing share analysis market as a market leader.

Speaker Change: We continue to make thoughtful investments in our broader pipeline and our service teams to drive

Speaker Change: Our strong balance sheets underpins our foundation which provides us with options and further flexibility in the future.

Speaker Change: We have a clear roadmap to expand our market leadership position in spare analysis.

Speaker Change: These powerful attributes provide us with confidence in our long-term objective of building sustainable

Speaker Change: I want to thank everyone for joining today's call and we will now open it up for questions.

I'll say that.

Speaker Change: Thank you. We will now begin the question and answer session. If you would like to ask a question, please press far one on your telephone keypad to raise your hand and join the queue.

Speaker Change: We will pause for just a moment to compare the Q&A roster to the Q&A roster.

Paul Goodson, William McCombe, Paul Goodson, William McCombe, Paul Goodson,

Speaker Change: Paul Goodson, John Freechack, John Freechack,

Speaker Change: Your first question comes from the line of Tejas Savant with Morgan Stanley , your line is open.

Speaker Change: Hi, this is Jason on for Tejas. Thank you for taking our questions.

Speaker Change: and I guess the third part would be there's currently 125% tariffs in China and US exports so obviously it's very hard to sell any products there. I'm wondering how much of the 2025 revenue guidance cut could be because of this dynamic like the inability to sell your products in China. Thank you.

Okay, let me try to take those.

Speaker Change: in order. So it's important to understand that we have established manufacturing facilities that are all producing and shipping products.

Speaker Change: in Three Regions, the US Singapore, which is our new facility in Wushie, China.

Speaker Change: and so our primary strategy for managing tariffs is what we call region for region manufacturing.

So we make ...

Speaker Change: Product in for sale in a particular region, in the region that will be least impacted by tariffs, so you know, making product for Asia and Europe in Asia and US product for sale in the US.

Obviously, we can't do that.

Speaker Change: Potential Terrific Liability that way. The other thing that we can do is reorganize where we source components from. And then thirdly, we are recovering some costs from customers.

through surcharges.

In 2025, we...

and when I say that I'm obviously pointing.

to one side.

Speaker Change: The economic and market environment that we're in, but in Tejas terraces specifically, we don't think that will have an impact.

Speaker Change: In terms of gross margin, the impact, I think, will be fairly limited in the range of 1 to 3 percent. And in that regard,

Speaker Change: We would expect, as I mentioned in my remarks, that gross module will improve.

Over the ensuing quarters.

Speaker Change: because we expect that revenues will follow a typical seasonal pattern where they'll be stronger in Q2, 3 and 4 and, you know, with higher revenues.

Paul, we see a benefit at the Gross margin line.

Did I cover all your questions?

Speaker Change: Yeah, most of it. And in the third part, just about the 125% tarot from China and US exports, are you still able to sell your products in China? Thank you.

Speaker Change: We are able to sell products in China, absolutely, but that's the way that we deal with that.

at Tariff. Thank you.

Speaker Change: through our region for region manufacturing. So obviously products sold in China don't incur a tariff if they're manufacturing in China or if they're manufacturing in Singapore.

Thank you.

Speaker Change: I'm going to come out with this revised guidance, so the short answer to your question is it's effective into what was told you about revenue expectations.

Speaker Change: I would make a couple of points. One is that more than 50% of our revenue is outside the United States.

Um, so obviously-

Speaker Change: You know, that revenue isn't affected by U.S. University funding and then, thirdly, most importantly is we think about our revenue in free buckets.

Speaker Change: Reagents, which also saw some nice growth in Q1, particularly in US and Amir. And then the instrument portion of our revenue is the one that's most impacted.

Speaker Change: She's like the one that you mentioned. But the other two revenue sources or revenue streams are...

No, not particularly affected by US University funding issues.

Speaker Change: All that said, we are continuing to sell instruments to U.S. universities here in the second quarter.

Speaker Change: Your next question comes from the line of Matt Skies with Goldman Sachs. Your line is open.

Speaker Change: Hi, this is Evian from AdThings for Take My Questions. So the first one on the Arora cell disorder, what drove the double digit growth there, and are there any specific end markets you would call out that may be differentiated versus your other

Speaker Change: I think we are seeing nice girls across all territories for our self-sorters.

Speaker Change: and widely being adopted by both academic and industry users. And this matching of the panels between Cytek Soda and Cytek Analyze clearly demonstrated the benefits for our users, making it very easy for them.

Speaker Change: so this is something they would like to see and so even under today's we know the tight budget situations they see the benefits and

Speaker Change: Okay, great, thank you. And then another one on phasing, you noted that you expected growth would be back half-loaded this year. What's driving this assumption? And is there any specific end market you expect to improve as we move throughout the year?

Speaker Change: The two factors. One is that typically out second half of the year represents a more than 50% of total sales, so it's...

Speaker Change: You know, generally usually somewhere in the mid 50s, so that's point one, and that's just a function of the buying patents of our customers.

Ra. Significantly more active.

We don't, obviously, there are some new uncertainties in the market environment, we, you know, can't, uh...

Speaker Change: Conte, predict the future with respect to overall economic growth and the board of market, but beyond that we don't see anything that would suggest.

and then point two is that

Speaker Change: some signaling of direct reductions in funding, but to a large part it's been the driver of reduced spending has been uncertainty about what the future may hold.

Speaker Change: I'm not unreasonable to expect that as we get further into the year that

our customers.

Funding individual funding situations will be clear us.

Speaker Change: and that some of that uncertainty might, might lessen. And so I think that's also...

and Overlay of how we think about it this.

Speaker Change: I also want to come back to this point that our revenue outlook is a function of...

Speaker Change: is formulated based on three different revenue streams, service, you know, where we think that the installed base and the usage and activity of our systems is going to drive continued growth.

Reagents, where we've been seeing nice solid growth trends. So those...

Speaker Change: The seasonal variation and lessening uncertainty, primarily going to affect the instrument portion of our business.

Speaker Change: The Recurring Revenue from Service and Regiment have now exceeded 30% of our total revenue. Up from 26% a year ago to 31.

Speaker Change: and that recurring portion is growing 17, so that should continue to...

Speaker Change: to grow at similar rates. The service revenue growth rate just as the installed base increases. You know, that's going to moderate slightly, but that's something that's an effect that will, you know, take some of these to growth.

Great, thank you.

Speaker Change: Your next question comes from the line of David Westenberg with Piper Assembly. Your line is open.

Speaker Change: This is John on for Dave. Thanks for taking the questions.

Speaker Change: So could you just comment on whether or not you're seeing any of your competitors raising prices due to tariffs and also could you give any color on your R&D spending? Are you looking more into imaging or spectral for new product innovation? Thank you.

Speaker Change: , , , , , , , , , , , , , ,

Speaker Change: on the pricing side of things still in the early stage, and I think...

Speaker Change: We do see a report talking about passing around some of the trade of cost over to the customers but we still wait to see how it's going to impact the overall market situation.

which we are working on within the R&D Department.

Okay, thank you.

Speaker Change: The next question comes from the line of Chad. Wiatrowski with TD Cowen. The line is open.

Paul Goodson, John Freechack, John Freechack, John Freechack, John Freechack,

Speaker Change: Hey, guys, this is Chad, and I trust him for Brendan Smith. Just on the sharey purchases this quarter, obviously the balance sheets still healthy, how do you sort of reconcile doing sharey purchases versus like M&A or organic investment and what sort of a plan throughout the remainder of the year?

Speaker Change: With respect to specific Sherry purchase plans, I can't say much more than...

did renew our authorization.

Speaker Change: White last year, we purchased ten and a half million dollars worth of shares in the first quarter, approximately 2.1 million.

You know, that's basically all I can say for the time being.

Speaker Change: in terms of capital allocation priorities, now plan is to have capital available to do both.

Speaker Change: Again, if you would like to ask a question, press file 1 on your telephone keypad.

Speaker Change: Your next question comes from the line of Andrew Cooper with Raymond James, your line is open.

Speaker Change: Hey everyone, this is Noah on for Andrew. First question, just wanted to get a feel for what are customers saying about the Cytek Muse? Are you seeing a lot of interest? I just want to get an idea of what you're seeing in that new product launch.

Speaker Change: Yeah, Cytek Muse has been a new product line and is to support Gene and his fellow people. And this is...

Evaluation Stage, but we do have some early products.

Speaker Change: Anthony into a new market in the meantime to help drive our reagent revenue as well.

Speaker Change: Awesome. And then maybe if I can just get one more, you know, you mentioned pharma biotech and I think the CRO market, postponing orders. Just kind of want to get an idea of what you're seeing now that we're about a week in the May. Is there a little bit more optimism? Is it still just about the same as April ? And then also how does that compare to what you're hearing from your academic and government customers as it relates to funding? [inaudible]

Speaker Change: So, I've also mentioned that, you know, we expect to see—

So there's nothing that we've seen.

Speaker Change: So far in May that would be at odds with that, but we don't typically comment on month by month so give quarterly guides but just...

Suffice it to say that typically LQ-2 is...

Stronger than our Q1

So, any, you know...

Speaker Change: So the evidence around second quarter, so far, is limited, but it's consistent with the...

and supports the views that we've expressed here.

Speaker Change: Pharma Customers versus Academic and Research, you know, I think you'll see from out 10Q that revenue from those two sectors was down by a similar amount, so, you know, we saw...

cautious

You know, we haven't seen much different other than, uh...

Keppel Spending, but, you know, our systems...

Speaker Change: Big five must still have a strong preference for our systems because...

Speaker Change: who are uniquely capable of being harmonized and that's very important to them and we continue to see multiple system orders from Big Pharma to have you.

Q1 2025 Cytek Biosciences Inc Earnings Call

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