Q3 2025 Repligen Corp Earnings Call

Speaker #3: Thank you for standing by . My name is Kayla , and I will be your conference operator today . At this time , I would like to welcome everyone to the Repligen Corporation earnings release .

Operator: Thank you for standing by. My name is Kayla and I will be your conference operator today. At this time, I would like to welcome everyone to the Repligen Corporation earnings release, third quarter of 2025. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, again press the star and one. I would now like to turn the call over to Jacob Johnson, Vice President of Investor Relations. You may begin.

Speaker #3: Third quarter of 2025. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session.

Speaker #3: If you'd like to ask a question during this time , simply press star , followed by the number one on your telephone keypad .

Speaker #3: If you'd like to withdraw your question , press the star and one . I would now like to turn the call over to Jacob Johnson , VP of Investor Relations .

Speaker #3: You may begin .

Speaker #4: Thank you . Operator and welcome everyone to our 2025 third quarter report . On this call , we will cover business highlights and financial performance for the three month period ended September 30th , 2025 and will provide financial guidance for the full year 2025 .

Jacob Johnson: Thank you, operator. Welcome everyone to our 2025 third quarter report. On this call we will cover business highlights and financial performance for the three month period ended September 30, 2025. I will provide financial guidance for the full year 2025. Joining us on the call today are Repligen Corporation's President and Chief Executive Officer Olivier Loeillot and our Chief Financial Officer Jason Garland. As a reminder, the forward-looking statements that we make during this call, including those regarding our business goals and expectations for the financial performance of the company, are subject to risks and uncertainties that may cause actual events or results to differ.

Speaker #4: Joining us on the call today are Repligen Corp. President and Chief Executive Officer Olivier Luo and our Chief Financial Officer Jason Garland.

Speaker #4: As a reminder , the forward looking statements that we make during this call , including those regarding our business goals and expectations for the financial performance of the company , are subject to risks and uncertainties that may cause actual events or results to differ .

Speaker #4: Additional information concerning risks related to our business is included in our quarterly Reports on Form 10-q . Our Annual Report on Form 10-K for the fiscal year ended December 31st , 2024 , and our current reports , including the form 8-K , that we are filing today and other filings that we make with the Securities and Exchange Commission .

Jacob Johnson: Additional information concerning risks related to our business is included in our quarterly reports on Form 10-Q, our annual report on Form 10-K for the fiscal year ended December 31, 2024, and our current reports, including the Form 8-K that we are filing today and other filings that we make with the Securities and Exchange Commission. Today's comments reflect management's current views, which could change as a result of new information, future events or otherwise. The company does not oblige or commit itself to update forward-looking statements except as required by law. During this call we are providing non-GAAP financial results and guidance unless otherwise noted. Reconciliations of GAAP to non-GAAP financial measures are included in the press release that we issued this morning, which is posted to Repligen Corporation's website and on sec.gov.

Speaker #4: Today's comments reflect management's current views , which could change as a result of new information , future events or otherwise . The company does not oblige or commit itself to update forward looking statements except as required by law .

Speaker #4: During this call , we are providing non-GAAP financial results and guidance unless otherwise noted . Reconciliations of GAAP to non-GAAP financial measures are included in the press release that we issued this morning , which is posted to REPLIGEN CORP website and on SCC gov .

Speaker #4: Adjusted non-GAAP figures in today's report include the following non-COVID and organic revenue and or revenue growth . Cost of goods sold , gross profit and gross margin .

Jacob Johnson: Adjusted non-GAAP figures in today's report include the non-COVID and organic revenue and/or revenue growth, cost of goods sold, gross profit and gross margin, operating expenses including R&D, SG&A, income from operations and operating margin, tax rate on pre-tax income, net income, diluted earnings per share, EBITDA, adjusted EBITDA and adjusted EBITDA margin. These adjusted financial measures should not be viewed as an alternative to GAAP measures, but are intended to best reflect the performance of our ongoing operations. With that, I'll turn the call over to Olivier.

Speaker #4: Operating expenses including R&D and SG&A . Income from operations and operating margin . Tax rate on pre-tax income , net income , diluted earnings per share , EBITDA , adjusted EBITDA and adjusted EBITDA margin .

Speaker #4: These adjusted financial measures should not be viewed as an alternative to GAAP measures , but are intended to best reflect the performance of our ongoing operations .

Speaker #4: With that , I'll turn the call over to Olivier .

Speaker #5: Thank you . Jacob . Good morning , everyone , and welcome to our 2025 third quarter call . We had another outstanding quarter in quarter three with 18% organic growth this quarter .

Olivier Loeillot: Thank you, Jacob. Good morning, everyone, and welcome to our 2025 third quarter call. We had another outstanding quarter in Q3 with 18% organic growth. This quarter, every franchise grew double digits, which is a testament to our differentiated, broad portfolio and diversified customer base. Our portfolio of products enables us to sell one of the most comprehensive suites of innovative solutions across the bioprocessing workflow. We saw strength across our extensive customer base as both biopharma and CDMOs grew over 20%, and all geographies grew double digits. The continued growth from CDMOs is very encouraging as it reflects the health of the ecosystem from a franchise perspective. Analytics led the way with over 50% growth, including more than 30% growth at CTEC, while filtration grew over 20%.

Speaker #5: Every franchise grew double digit , which is a testament to our differentiated , broad portfolio and diversified customer base . Our portfolio of products enables us to sell one of the most comprehensive suites of innovative solutions across the bioprocessing workflow .

Speaker #5: We saw strength across our extensive customer base as both biopharma and cdmos grew over 20% and all geographies grew double digits . The continued growth from Cdmos is very encouraging as it reflects the health of the ecosystem from a franchise perspective .

Speaker #5: Analytics led the way with over 50% growth , including more than 30% growth at C-tech , while filtration grew over 20% . Consumable demand remains very robust , with greater than 20% growth in the quarter , while capital equipment had another strong quarter with over 20% growth .

Olivier Loeillot: Consumable demand remains very robust with greater than 20% growth in the quarter, while capital equipment had another strong quarter with over 20% growth. The better than expected performance in analytics and proteins this quarter underscores that growth opportunities exist across our entire portfolio, driven by our innovation engine. In particular, analytics revenue growth was aided by the launch of SoloVPE Plus earlier this year. This new generation of at-line protein concentration analytics offers customers increased data collection speed and enhanced sensitivity and reproducibility with a streamlined workflow. This has started to drive an upgrade cycle that will last for several years as we have a sizable install base. Transitioning to orders, total company orders grew sequentially for the sixth straight quarter and grew over 20% year over year, including double digit order growth across all of our franchises, with customer ordering patterns back to historical trends.

Speaker #5: The better than expected performance in analytics and proteins this quarter underscores the growth opportunities exist across our entire portfolio , driven by our innovation engine .

Speaker #5: In particular , analytics revenue growth was aided by the lounge of Solo Plus earlier this year . This new generation of at line protein concentration analytics offers customers increased data collection speed and enhanced sensitivity and reproducibility with a streamlined workflow .

Speaker #5: This has started to drive an upgrade cycle that , will last for several years , as we have a sizable installed base transitioning to orders .

Speaker #5: Total company orders grew sequentially for the sixth straight quarter and grew over 20% year over year , including double digit order growth across all of our franchises .

Speaker #5: With customer ordering patterns . Back to historical trends . We believe quarterly orders are a less relevant metric and plan to provide less detail around orders going forward .

Olivier Loeillot: We believe quarterly orders are a less relevant metric and plan to provide less detail around orders going forward. We will remain transparent around the trends we are seeing in our business and within the industry as we have always been. We think our Q3 results highlight the broad strength we are seeing across our franchises, customers, and geographies, and our 18% organic growth continues to outpace industry growth. In fact, this marks the fourth straight quarter of 14% or better organic non-COVID growth. Both our Q3 and year to date overall performance was not based on a single customer product line but rather the totality of our portfolio. We think this is a testament to our commercial execution as our team capitalizes on the growth strategies for each of our franchises. As a result, we are again raising the midpoint of our organic growth guidance for 2025.

Speaker #5: We will remain transparent around the trends we are seeing in our business and within the industry . As we have always been . We think our Q3 results highlight the broad strength we are seeing across our franchises , customers and geographies and our 18% organic growth continues to outpace industry growth .

Speaker #5: In fact , this marks the fourth straight quarter of 14% or better organic non-COVID growth . Both our Q3 and year to date overall performance was not based on a single customer product line , but rather the totality of our portfolio .

Speaker #5: We think this is a testament to our commercial execution as our team capitalizes on the growth strategies for each of our franchises . As a result , we are again raising the midpoint of our organic growth guidance for 2025 .

Speaker #5: Unpacking our performance by end market Q3 25 . Biopharma revenues grew over 20% year over year , with broad growth across all biopharma customers emerging biotech revenue was at the highest level in nearly three years .

Olivier Loeillot: Unpacking our performance by end market, Q3 2025 biopharma revenues grew over 20% year over year with broad growth across all biopharma customers. Emerging biotech revenue was at the highest level in nearly three years. While we're hesitant to call this a trend as growth benefited from some specific opportunities in the quarter, we are encouraged by the recent funding trends we have seen. CDMO revenues also grew over 20%, driven by outperformance from our larger CDMO customers in the quarter. From a geographical point of view, we saw particular strength in Asia Pacific with approximately 50% growth, while the Americas grew 20% and EMEA was up low double digits. New modalities revenue were consistent with our expectation for a muted back half. We saw growth in cell therapy while AAV and mRNA trends were fairly consistent with last quarter.

Speaker #5: While we are hesitant to call this a trend as growth benefited from some specific opportunities in the quarter , were encouraged by the recent funding trends .

Speaker #5: We have seen CDMO revenues also grew over 20% , driven by outperformance from our larger CDMO customers in the quarter . From a geographical point of view , we saw particular strength in Asia Pacific with approximately 50% growth , while the Americas grew 20% and EMEA was up low , double digit .

Speaker #5: New modalities revenue was consistent with our expectations for a muted back half. We saw growth in cell therapy, while AAV and mRNA trends were fairly consistent with last quarter.

Speaker #5: Turning to strategy , we mentioned last quarter that digitization is a key pillar of our strategic plan . Our analytics franchise is a foundation of this strategy .

Olivier Loeillot: Turning to strategy, we mentioned last quarter that digitization is a key pillar of our strategic plan. Our analytics franchise is the foundation of this strategy, so we wanted to expand on this effort and provide more detail on the very strong performance in Q3. Digitization will be a multi-step and a multi-year journey. Currently, we enable measurements of protein concentration in downstream processes using our innovative solution from C Technologies and glucose, lactate, and biomass upstream with the acquisition of the 908 Devices bioprocessing assets. With the successful inline integration of C Technologies' FlowVPX into our downstream TFF systems, we can provide real-time monitoring and process control. These are key enablers of continuous manufacturing, which is still in its early days, particularly in downstream applications. We're actively working to develop additional PAT-enabled solutions.

Speaker #5: So we wanted to expand on this effort and provide more detail on the very strong performance in Q3 . Digitization will be a multi-step and a multi-year journey .

Speaker #5: Currently , we enable measurements of protein concentration in downstream processes using our innovative solution from key technologies and glucose , lactate and biomass .

Speaker #5: Upstream . With the acquisition of the 908 bioprocessing assets with a successful inline integration of flow , into our downstream TFF systems , we can provide real time monitoring and process control .

Speaker #5: These are key enablers of continuous manufacturing , which is still in its early days . Particularly in downstream applications . We're actively working to develop additional Pat enabled solutions .

Speaker #5: Beyond this , we are looking at opportunities to leverage digital twins to utilize these real time process data with advanced modeling to optimize process development and manufacturing .

Olivier Loeillot: Beyond this, we are looking at opportunities to leverage digital twins to utilize this real-time process data with advanced modeling to optimize process development and manufacturing. As a step in this direction, we announced a partnership with Novasign during the third quarter to integrate our system with Novasign's digital twin capability. Starting with our bench scale CSS, we aim to deliver solutions that significantly reduce process development time and cost and support a more efficient and reliable scale-up for our customers. We also saw strong growth in overall service revenue in Q3. Services currently represent 5% of our consolidated revenue. We have a particularly high attachment rate in analytics, so we benefit from both new installations and annual maintenance. Commercially, a strong service organization allows us to best serve and delight our customers while bringing us to be closer to them.

Speaker #5: As a step in this direction , we announced a partnership with Novacine during the third quarter to integrate our systems with Nova Digital twin Capability , starting with our bench scale TFF , we aim to deliver solutions that significantly reduce process development time and cost , and support a more efficient and reliable scale up for our customers .

Speaker #5: We also saw strong growth in overall service revenue in quarter three services . Currently represent 5% of our consolidated revenue . We have a particularly high attachment rate in analytics , so we benefit from both new installations and annual maintenance .

Speaker #5: Commercially , a strong service organization allows us to best serve and delight our customers while bringing us to be closer to them . There is a sizable opportunity for us to grow this business in coming years , as we expand our services offerings across our entire capital equipment portfolio , our strategic account strategy Initiative , launched three years ago , is a real success story .

Olivier Loeillot: There is a sizable opportunity for us to grow this business in coming years as we expand our services offerings across our entire capital equipment portfolio. Our Strategic Account Initiative launched three years ago is a real success story. We are now covering 20 large pharma and CDMO accounts. The focus of our key accounts team is to engage with key decision makers at our customers to better understand their needs while demonstrating the breadth of our capabilities. We are seeing great traction here with more of these customers buying multiple products from Repligen and as a result, many of these strategic accounts are accretive to our growth. In addition to our strategic account strategy, our commercial team is also incentivized to cross-sell products across the entire portfolio.

Speaker #5: We are now covering 20 large pharma and CDMO accounts . The focus of our key account team is to engage with key decision makers at our customers to better understand their needs , while demonstrating the breadth of our capabilities .

Speaker #5: We are seeing great traction here with more of these customers by multiple products from Repligen and as a result , many of these strategic accounts are creative to our growth .

Speaker #5: In addition to our strategic account strategy , our commercial team is also incentivized to cross-sell products across the entire portfolio as it pertains to tariffs .

Olivier Loeillot: As it pertains to tariffs, we continue to evaluate opportunities to better leverage our global footprint while working towards dual manufacturing for the vast majority of our portfolio by the end of next year. This includes a focus on ensuring we have the right footprint to benefit from capital equipment opportunities in coming years, including potential U.S. onshoring projects. Before I turn the call over to Jason, I'll provide some more detail on our franchise level performance. Filtration revenue grew over 20% in the quarter. Flat sheet cassettes, 3 in management flowpath along with ATF all contributed meaningfully to growth this quarter. We continue to see a long runway of growth in ATF, but we think it's important to highlight that multiple products have been key drivers of year-to-date filtration growth. This highlights the breadth of our filtration franchise, which is our largest and most diverse.

Speaker #5: We continue to evaluate opportunities to better leverage our global footprint . We are working to have dual manufacturing for the vast majority of our portfolio .

Speaker #5: By the end of next year . This includes a focus on ensuring we have the right footprint to benefit from capital equipment opportunities in coming years , including potential US entering projects .

Speaker #5: Before I turn the call over to Jason , I'll provide some more detail on our franchise level performance , filtration , revenue grew over 20% in the quarter .

Speaker #5: Flat sheet cassettes , fluid management Flowpaths , along with Atfs all contributed meaningfully to growth this quarter . We continue to see a long runway of growth in Atfs , but we think it's important to highlight that multiple products have been key drivers of year to date filtration growth .

Speaker #5: This highlights the breadth of our filtration franchise , which is our largest and most diverse in addition , we have a strong backlog for fluid management , so we continue to expect robust growth from this product line in coming quarters .

Olivier Loeillot: In addition, we have a strong backlog for fluid management, so we continue to expect robust growth from this product line in coming quarters. After record Q2, chromatography revenue grew mid-teens in Q3 as resin mix returned to more normal levels. This was mostly driven by continued strength in large column demand from key CDMOs and pharma accounts globally. Protein revenue grew low double digit in quarter, driven by chromatography resins. This franchise outperformed our expectation in the quarter and is an area where we are making additional investments to drive future growth. We have several innovative solutions for the new modality market with our Aviti 20 assets and for the monoclonal antibody market by our Protein A ligand capabilities. We plan to launch additional innovative solutions across its portfolio in coming years.

Speaker #5: After a record Q2 chromatography revenue grew mid-teens in Q3 as resin mixed returned to more normal levels . This was mostly driven by continued strength in large demand from key cdmos and pharma accounts globally , protein revenue grew low double digit in quarter , driven by chromatography resin .

Speaker #5: This franchise outperformed our expectations in the quarter and is an area where we are making additional investments to drive future growth . We have several innovative solutions for the new modality markets .

Speaker #5: With our tight key assets and for the monoclonal antibody market, by our protein ligand capabilities, we plan to launch additional innovative solutions across this portfolio in the coming years.

Speaker #5: While it will take some time for this , opportunities to grow into more meaningful revenues , we think the investment we are making today will position us well for growth in these higher margin franchise .

Olivier Loeillot: While it will take some time for these opportunities to grow into more meaningful revenues, we think the investment we are making today will position us well for growth in this higher margin franchise for years to come. Finally, and as already mentioned, process analytics had a standout Q3 with more than 50% growth, including $3 million of revenue from the 908 Devices bioprocessing acquisition and over 30% growth at CTEC. This was driven by strength across consumables, equipment, and services with strong orders in the quarter. We are encouraged by the momentum in our analytics franchise as it relates to the 908 Devices bioprocessing assets. We remain on plan with the integration to wrap up. While the last several years have been a unique period for the bioprocessing market, we believe the dynamics of this year have created additional opportunities for Repligen Corporation.

Speaker #5: For years to come . Finally , and has already mentioned process analytics had a standout Q3 with more than 50% growth , including 3 million of revenue from the 908 bioprocessing acquisition and over 30% growth at Ktec .

Speaker #5: This was driven by strength across consumables , equipment and services , with strong orders in the quarter were encouraged by the momentum in our analytics franchise as it relates to the 908 bioprocessing assets , we remain on plan with the integration .

Speaker #5: To wrap up , why the last several years have been a unique period for the bioprocessing market . We believe the dynamics of this year have created additional opportunities for repligen .

Speaker #5: Customers are looking for products that enable them to improve yield and productivity . Our product portfolio and customer centricity have opened a number of doors in recent years , and we believe the results we are seeing this year are a testament to our strategy .

Olivier Loeillot: Customers are looking for products that enable them to improve yield and productivity. Our product portfolio and customer centricity have opened a number of doors in recent years, and we believe the results we are seeing this year are a testament to our strategy. We remain focused on capitalizing on our growing funnel. Given the opportunities we see across our portfolio, we will continue to invest as needed to ensure we have the right foundation to support sustainable future growth. This includes planned investment in application labs to better serve our customers with differentiated solutions, investments in technology to increase productivity, and investment across our business to ensure we have robust processes and tools to continue to delight customers and scale our growing business. We'll balance these initiatives with a commitment to driving margin expansion over the medium term.

Speaker #5: We remain focused on capitalizing on our growing funnel , given the opportunities we see across our portfolio . We will continue to invest as needed to ensure we have the right foundation to support sustainable future growth .

Speaker #5: This includes plan investment in application labs to better serve our customers with differentiated solutions . Investments in technology to increase productivity and investment across our business to ensure we have robust processes and tools to continue to delight customers and scale our growing business .

Speaker #5: We'll balance this initiatives with a commitment to driving margin expansion over the medium term . We're excited about the customer traction across our business , as highlighted by our year to date performance , which demonstrates the differentiated nature of Repligen .

Olivier Loeillot: We're excited about the customer traction across our business as highlighted by our year to date performance, which demonstrates the differentiated nature of Repligen Corporation. It also reflects the execution on the five strategic priorities we outlined at the beginning of the year. We remain focused on closing out a very strong 2025. Now I'll turn the call over to Jason Garland for the financial highlights.

Speaker #5: It also reflects the execution on the five strategic priorities we outlined at the beginning of the year. We remain focused on closing out a very strong 2025.

Speaker #5: Now I'll turn the call over to Jason for the financial highlights.

Speaker #6: Thank you . Olivier , and good morning , everyone . Today we are reporting our financial results for the third quarter of 2025 .

Jason Garland: Thank you Olivier and good morning everyone. Today we are reporting our financial results for the third quarter of 2025 and providing an update to our financial guidance for the full year. Unless otherwise noted, all financial measures discussed reflect adjusted non-GAAP measures. As shared in our press release this morning, we delivered third quarter revenue of $189 million, a reported year-over-year increase of 22%. This is 18% organic growth excluding the impact of acquisitions and currency. Acquisitions contributed approximately two points of the reported growth, while foreign currency was also a two-point tailwind. As Olivier offered details on our product franchise performance, I'll provide more color on our regional performance starting with quarterly revenue. North America represented approximately 50% of our total, Europe represented 30%, and Asia Pacific and the rest of the world represented approximately 20%.

Speaker #6: And providing an update to our financial guidance for the full year . Unless otherwise noted , all financial measures discussed reflect adjusted non-GAAP measures as shared in our press release this morning .

Speaker #6: We delivered third quarter revenue of $189 million . A reported year over year increase of 22% . This is 18% organic growth , excluding the impact of acquisitions and currency acquisitions contributed approximately two points of the reported growth .

Speaker #6: While foreign currency was also a two point tailwind . As Olivier offered details on our product franchise performance . I'll provide more color on our regional performance , starting with quarterly revenue .

Speaker #6: North America represented approximately 50% of our total . Europe represented 30% , and Asia Pacific and the rest of the world represented approximately 20% .

Speaker #6: Asia Pacific grew nearly 50% year over year , driven by fluid management , analytics , and ATF . Americas grew 20% , with strength across the portfolio and EMEA grew low .

Jason Garland: Asia Pacific grew nearly 50% year-over-year driven by fluid management, analytics, and ATF. Americas grew 20% with strength across the portfolio, and EMEA grew low double digits driven by OPUS and TangenX. After strong orders in Q2, we saw China revenue return to growth in Q3. Though not a key driver for the overall strength in Asia Pacific, it was encouraging to see growth even off a low prior year base. We remain optimistic that China will return to growth in 2026, though we still expect China to be slightly down this year as orders declined in the quarter after the order acceleration in Q2. Transitioning to profit and margin, adjusted gross profit was $101 million, up 28% year-over-year or 25% excluding foreign currency and acquisitions. Adjusted gross margin of 53.3% increased 260 basis points year-over-year and 210 basis points sequentially.

Speaker #6: Double digits , driven by opus and tanks . After strong orders in Q2 , we saw China revenue return to growth in Q3 , though not a key driver for the overall strength in Asia Pacific , it was encouraging to see growth even off a low prior year base .

Speaker #6: We remain optimistic that China will return to growth in 2026 , though we still expect China to be slightly down this year as orders declined in the quarter after the order acceleration in Q2 .

Speaker #6: Transitioning to the profit and margin adjusted gross profit, it was $101 million, up 28% year over year, or 25% excluding foreign currency and acquisitions.

Speaker #6: Adjusted gross margin of 53.3% increased 260 basis points year over year , and 210 basis points sequentially . The year over year increase was driven by volume , leverage , price , and productivity .

Jason Garland: The year-over-year increase was driven by volume, leverage, price, and productivity. The sequential increase benefited primarily from improved mix as Repligen procured resin for OPUS columns were at more normal levels and from revenue growth of proteins in the quarter. This dynamic of gross margin fluctuation being driven by changes in sales mix is to be expected quarter to quarter. We are more focused on full year trends. Year to date, gross margin is 52.7% which shows 230 basis points of margin expansion over the same period in the prior year and is in line with our gross margin outlook of 52% to 53% for 2025. FX was a benefit to margin in the quarter while tariffs remained a slight headwind continuing through the P&L.

Speaker #6: The sequential increase benefited primarily from improved mix , as Repligen procured resin for opus columns were at more normal levels and from revenue growth of proteins in the quarter .

Speaker #6: This dynamic of gross margin fluctuation being driven by changes in sales mix , is to be expected quarter to quarter . We are more focused on full year trends year to date , gross margin is 52.7% , which shows 230 basis points of margin expansion over the same period in the prior year .

Speaker #6: And is in line with our gross margin outlook of 52 to 53% for 2025 . FX was a benefit to margin in the quarter , while tariffs remained a slight headwind , continuing through the PNL .

Speaker #6: Our adjusted income from operations was $27 million in the third quarter , up 16% year over year on a reported basis and up about 20% excluding the impact from foreign currency and M&A .

Jason Garland: Our adjusted income from operations was $27 million in the third quarter, up 16% year over year on a reported basis and up about 20% excluding the impact from foreign currency and M&A. This growth was driven by a $22 million increase in gross profit on higher volume and margin improvement, offset by $18 million higher OpEx. Q3 represented our lowest OpEx quarter last year, and growth this quarter included $3 million from M&A and $1 million from foreign currency. It also includes about $2 million of one-time expenses in SG&A that will not repeat in the fourth quarter. The remaining increase includes strategic investments which we will continue to make to support future growth. Year to date, OpEx has grown 14% excluding the impact of M&A and foreign exchange versus our 16% organic non-COVID revenue growth. This translated to an adjusted operating margin of 14.2%.

Speaker #6: This growth was driven by a $22 million increase in gross profit on higher volume and margin improvement , offset by $18 million higher opex .

Speaker #6: Q3 represented our lowest opex quarter last year , and growth this quarter included $3 million from M&A , $1 million from foreign currency .

Speaker #6: It also includes about $2 million of one time expenses in SGA that will not repeat in the fourth quarter . The remaining increase includes strategic investments , which we will continue to make to support future growth year to date .

Speaker #6: OpEx has grown 14% , excluding the impact of M&A and foreign exchange versus our 16% organic non-COVID revenue growth . This translated to an adjusted operating margin of 14.2% .

Speaker #6: Margins declined 70 bips year over year , largely due to M&A . Our third quarter adjusted EBITDA margin was 19% , a year over year decline of 160 basis points , which also included a $1 million headwind from foreign currency transaction losses , adjusted net income was $26 million , a $2 million year over year increase .

Jason Garland: Margins declined 70 bps year over year, largely due to M&A. Our third quarter adjusted EBITDA margin was 19%, a year over year decline of 160 basis points, which also included a $1 million headwind from foreign currency transaction losses. Adjusted net income was $26 million, a $2 million year over year increase. Higher adjusted operating income was offset by $3 million of lower interest income. Our third quarter adjusted effective tax rate was 17%, which benefited from actions executed within our tax planning strategy. We now expect to see an adjusted effective tax rate between 21% to 22% for the year, about 100 basis points lower than our previous guidance. Adjusted fully diluted earnings per share for the third quarter were $0.46 compared to $0.43 in the same period in 2024.

Speaker #6: Higher adjusted operating income was offset by $3 million of lower interest income . Our third quarter adjusted effective tax rate was 17% , which benefited from actions executed within our tax planning strategy .

Speaker #6: We now expect to see an adjusted effective tax rate between 21% to 22% for the year, about 100 basis points lower than our previous guidance.

Speaker #6: Adjusted fully diluted earnings per share for the third quarter were $0.46 , compared to $0.43 in the same period in 2024 . Finally , our cash position at the end of the third quarter was $749 million , up $40 million sequentially from the second quarter .

Jason Garland: Finally, our cash position at the end of the third quarter was $749 million, up $40 million sequentially from the second quarter. This was driven by incredibly strong operating cash flow performance in the quarter, driven mostly by improved working capital. We are very happy with our strong year to date results, delivering above market revenue growth and margin expansion, which positions us to deliver upon our updated outlook. I'll speak to adjusted financial guidance, but please note that our GAAP to non-GAAP reconciliations for our 2025 guidance are included in the reconciliation tables in today's earnings press release. Our guidance includes tariffs and our latest foreign currency assumptions as highlighted earlier by Olivier and on the strength of our portfolio, we are increasing the midpoint of our revenue growth guidance as we narrow towards the high end of the guidance range.

Speaker #6: This was driven by incredibly strong operating cash flow performance in the quarter , driven mostly by improved working capital . We are very happy with our strong year to date results , delivering above market revenue growth and margin expansion , which positions us to deliver upon our updated outlook .

Speaker #6: I'll speak to adjusted financial guidance , but please note that our GAAP to non-GAAP reconciliations for our 2025 guidance are included in the reconciliation tables in today's earnings press release .

Speaker #6: Our guidance includes tariffs and our latest foreign currency assumptions . As highlighted earlier by Olivier , and on the strength of our portfolio , we are increasing the midpoint of our revenue growth guidance as we narrow towards the high end of the guidance range .

Speaker #6: We now see 14 to 15.5% organic non-COVID growth , or 12 to 13.5% organic revenue growth . With the midpoint of both increasing 75 basis points from our prior guidance , our new guidance assumes just over a one point tailwind from foreign exchange .

Jason Garland: We now see 14 to 15.5% organic non-Covid growth or 12 to 13.5% organization organic revenue growth with the midpoint of both increasing 75 basis points from our prior guidance. Our new guidance assumes just over a one point tailwind from foreign exchange while our MA assumptions are unchanged. Putting this together, we are increasing our 2025 revenue guidance to $729 to $737 million, up from $715 to $735 million or an increase of $8 million at the midpoint. To summarize the update, clearly of the $8 million increase, $6 million is due to overall portfolio strength and $2 million is from foreign currency benefits. Our guidance implies Q4 revenue will grow low double digits organically at the midpoint while overcoming the headwind from a gene therapy platform mentioned last quarter.

Speaker #6: While our M&A assumptions are unchanged , putting this together , we are increasing our 2025 revenue guidance to 729 to $737 million , up from 715 to $735 million , or an increase of 8 million at the midpoint .

Speaker #6: To summarize , the update clearly , of the $8 million increase , 6 million is due to overall portfolio strength and 2 million is from foreign currency benefit .

Speaker #6: Our guidance implies for Q revenue will grow low double digits organically at the midpoint , while overcoming the headwind from a gene therapy platform mentioned last quarter .

Speaker #6: In terms of growth by franchise , we now expect the following reported growth rates . Filtration growth of approximately 10% versus our prior expectation of 10 to 12% .

Jason Garland: In terms of growth by franchise, we now expect the following reported growth rates: filtration growth of approximately 10% versus our prior expectation of 10 to 12%. This represents approximately 13.5% non-Covid growth. Chromatography growth of approximately 25% versus our prior estimate of 20%. Proteins growth of 15 to 20% versus 10 to 15% previously and finally analytics will grow north of 30% versus our prior guidance of 25%. This includes the 908 BioProcessing acquisition. We continue to expect adjusted gross margins in the range of 52 to 53% which represents 210 basis points of year-over-year margin expansion at the midpoint driven by volume, leverage, price and manufacturing productivity offset primarily by inflation and some 2024 Covid sales drag. We assume a slight headwind from tariff charges offset by benefit from foreign currency.

Speaker #6: This represents approximately 13.5% non-COVID growth in chromatography, growing approximately 25% versus our prior estimate of 20%. For proteins, we expect growth of 15% to 20% versus our previous estimate of 10% to 15%. Finally, analytics will grow north of 30% versus our prior guidance of 25%.

Speaker #6: This includes the 908 Bioprocessing Acquisition . We continue to expect adjusted gross margins in the range of 52 to 53% , which represents 210 basis points of year over year margin expansion at the midpoint , driven by volume leverage , price and manufacturing productivity , offset primarily by inflation and some 2024 Covid sales drag .

Speaker #6: We assume a slight headwind from tariff charges , offset by benefit from foreign currency . We expect fourth quarter gross margin to be closer to the second quarter , following the impact of sales mix fluctuations discussed earlier .

Jason Garland: We expect fourth quarter gross margin to be closer to the second quarter following the impact of sales mix fluctuations discussed earlier. The fourth quarter includes a mix shift to products that are below our corporate average. We now expect our adjusted income from operations to be between $98 to $100 million. This assumes a roughly 13.5% operating margin. As Olivier mentioned earlier, given the strength and traction we are seeing across our portfolio, we continue to make strategic investments today to support tomorrow's growth. This includes investments in specific product lines and geographies like Asia Pacific. In addition, we continue our Fit for Growth journey and will invest to ensure we have the right infrastructure to deliver on these opportunities for our customers, stakeholders, and shareholders. These include investments in operations and support functions. They also include investments in digital capabilities that will help drive efficiencies in the future.

Speaker #6: The fourth quarter includes a mix shift to products that are below our corporate average . We now expect our adjusted income from operations to be between 98 to $100 million .

Speaker #6: This assumes a roughly 13.5% operating margin . As Olivier mentioned earlier , given the strength in traction , we are seeing across our portfolio , we continue to make strategic investments today to support tomorrow's growth .

Speaker #6: This includes investments in specific product lines and geographies like Asia Pacific . In addition , we continue our fit for growth journey and will invest to ensure we have the right infrastructure to deliver on these opportunities for our customers , stakeholders and shareholders .

Speaker #6: These include investments in operations and support functions. They also include investments in digital capabilities that will help drive efficiencies in the future.

Speaker #6: We will continue to balance cost efficiency and margin expansion with investments that are critical to support future growth . Continuing through the PNL , we are updating our adjusted other income guidance to $21 million , down from 22 to $23 million due to lower interest income assumptions .

Jason Garland: We will continue to balance cost efficiency and margin expansion with investments that are critical to support future growth. Continuing through the P&L, we are updating our adjusted other income guidance to $21 million, down from $22 to $23 million due to lower interest income assumptions along with some impact from foreign currency. As we explained earlier, our 2025 adjusted effective tax rate expectation is now 21% to 22%, a point lower than our prior guidance. Given these dynamics, we now expect our adjusted fully diluted earnings per share to be between $1.65 and $1.68. Our balance sheet remains strong as we ended the third quarter with $749 million of cash. As mentioned earlier, we will remain prudent in our spending while maintaining flexible dry powder for potential acquisitions. We still expect CapEx to be down 20% to 25% versus 2024 with our spending below pre-COVID levels.

Speaker #6: Along with some impact from foreign currency . As we explained earlier , our 2025 adjusted effective tax rate expectation is now 21 to 22% , a point lower than our prior guidance .

Speaker #6: Given these dynamics , we now expect our adjusted fully diluted earnings per share to be between $1.65 and $1.68 . Our balance sheet remains strong .

Speaker #6: As we ended the third quarter with $749 million in cash, as mentioned earlier, we will remain prudent in our spending while maintaining flexible, dry powder for potential acquisitions.

Speaker #6: We still expect CapEx to be down 20 to 25% versus 2024 . With our spending below pre-COVID levels . As we wrap , we are encouraged by our strong year to date results , especially considering the headwinds in New modalities that we overcame .

Jason Garland: As we wrap, we are encouraged by our strong year-to-date results, especially considering the headwinds and new modalities that we overcame. We believe this performance reflects solid execution on our growth strategy and broader portfolio. Olivier and I would like to thank our Repligen teammates for helping us to deliver above market growth yet again. With that, I will turn the call back to the operator to open the line for questions.

Speaker #6: We believe this performance reflects solid execution on our growth strategy and broader portfolio . Olivier and I would like to thank our teammates for helping us to deliver above market growth .

Speaker #6: Yet again . With that , I will turn the call back to the operator to open the line for questions .

Speaker #3: At this time , I'd like to remind everyone , in order to ask a question , press star . Then the number one on your telephone keypad , please kindly limit to one question .

Operator: At this time I'd like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. Please kindly limit to one question. Your first question comes from the line of Dan Arias with Stifel. Your line is open.

Speaker #3: Your first question comes from the line of Dan Arias with stifle . Your line is open .

Speaker #7: Hey , good morning guys . Thank you . Hopefully you can hear me here . Olivier , can you maybe just talk about the cadence of order , momentum across the quarter and then out of the quarter ?

[Analyst]: Good morning, guys. Thank you. Hopefully you can hear me here. Olivier, can you maybe just talk about the cadence of order momentum across the quarter and then out of the quarter? I mean, obviously we've had some positive industry developments recently. Jason mentioned the China trajectory coming in as maybe a bit of an offset. How would you sum up purchasing activity here? To what extent does the Oregon midpoint bump capture what you're seeing? How do you feel like that positions you into next year just given where expectations are? Thanks.

Speaker #7: I mean , obviously we've had some positive industry developments recently . Jason mentioned that China trajectory coming in as maybe a bit of an offset .

Speaker #7: So, how would you sum up purchasing activity here? To what extent does the organic midpoint bump capture what you're seeing? And then how do you feel like that positions you into next year?

Speaker #7: Just given where expectations seem to be ? Thanks so much .

Speaker #8: Yeah , I hope I heard you well .

Olivier Loeillot: Yeah, I hope I heard you well enough, Dan. I think you were asking about cadencing of orders in Q3 here. I mean you've heard orders went really well for us again in Q3. We grew our orders more than 20%, which is the second quarter in a row our orders are growing more than 20%. In fact, it's six quarters in a row that we've seen sequencing order growth. What I really like among others is every single franchise really grew double digit in the quarter. There was no real change between July, August, September. It was pretty, pretty same, same type of growth during the entire quarter. I think I heard a question about what's going on in the industry globally, with the question specifically on China. We think we are back to really operating that business in a very normal environment.

Speaker #5: Enough .

Speaker #8: Dan , I .

Speaker #5: Think you were asking about cadence of orders in quarter three . So I mean , you've heard like orders went really well for us again in quarter three .

Speaker #5: I mean , we we grew orders more than 20% , which is the second quarter in a row , like our orders are growing more than 20% .

Speaker #5: In fact , it's six quarters in a row that we've seen sequencing order growth . And what I really like , among others , is every single franchises really grew double digit in the quarter .

Speaker #5: So and there was no real change between July , August , September . I mean , what was pretty , pretty same same type of growth during the entire quarter .

Speaker #5: And then I think I heard question about what's going on in the industry globally and with the question specifically on China . I mean , yeah , we think we are back to really operating that business in a very normal environment .

Speaker #5: I mean , it started with biopharma maybe a year and a half ago , and the CDMO maybe three , four quarters ago .

Olivier Loeillot: It started with biopharma maybe a year and a half ago, then the CDMOs maybe three, four quarters ago. What was really interesting to see for this quarter was a very nice recovery of small biotechs. Certainly too early to celebrate, but to see the small biotech business at the highest level for the last three years was very encouraging. Talking about geographies, also very strong across the board. China grew nicely, which was one of the first times for several quarters, grew in terms of sales, orders were a little bit softer. As we all know, we're at the beginning of what we expect to be full recovery and we do expect to be back to growth in China next year. That's kind of the overall situation here.

Speaker #5: What was really interesting to see for us this quarter was a very nice recovery of small biotech , certainly too early to celebrate , but to see the small biotech business at the highest level for the last three years was very encouraging .

Speaker #5: And then talking about geographies also very strong across the board , China grew nicely , which was one of the first time for several quarters grew in terms of sales orders were a little bit softer .

Speaker #5: But as we all know , we're at the beginning of really full what we expect to be full recovery . And we do expect to to be back to growth in China next year .

Speaker #5: So that's kind of the overall situation here .

Speaker #4: Operator: I think we can go to the next question.

Jacob Johnson: Operator, I think we can go to the next question.

Speaker #3: Sounds great . And your next question comes from the line of Dan Leonard with UBS . Your line is open .

Operator: Sounds great. Your next question comes from the line of Dan Leonhard with UBS. Your line is open.

Speaker #9: Thank you very much . A lot of moving parts on the margin side , Jason , I was hoping you could better help me reconcile the sales guidance increase versus narrowing your Ebit margin to the bottom end of prior guide and wondering also if you can make a comment on on what's the right level of operating margin expansion for a high teens revenue growth rate in the Repligen model ?

[Analyst]: Thank you very much. A lot of moving parts on the margin side. Jason, I was hoping you could better help me reconcile the sales guidance increase versus narrowing your EBIT margin to the bottom end of prior guide. I am wondering also if you can make a comment on what's the right level of operating margin expansion for a high teens revenue growth rate in the Repligen model. Thank you.

Speaker #9: Thank you .

Speaker #6: Yeah . Look , I mean , first I'd say we're overall happy with our margin performance in the quarter . And and to your point as well , seeing the trends in margin expansion , you know , gross gross margin , as we highlighted are going to move a little bit with with the mix of business that we have in the quarter .

Jason Garland: Yeah, look, I mean first I'd say we're overall happy with our margin performance in the quarter, and to your point as well, seeing the trends in margin expansion. You know, gross margin as we highlighted are going to move a little bit with the mix of business that we have in the quarter. We are quite favorable in Q3. When you look more importantly at the year to date, you know we're up 230 basis points. Kind of rolling that down to operating income, in the quarter we were up about 20% if you exclude the impact of M&A and currency. That's the dollars of operating income versus about 18% of non-organic. Again, continuing to get some of that leverage. I know for operating margin overall for the year, again I put in that same context.

Speaker #6: We were quite favorable in three Q and when you look more more importantly at the year to date , you know , we're we're up , you know , 230 basis points kind of rolling that down to operating income , you know , in the quarter we were up about 20% .

Speaker #6: If you exclude the impact of of M&A and currency . So that's the dollars of operating income versus about 18% of non-organic . again , continuing to get some of that leverage .

Speaker #6: Look , I know for for operating margin overall for the year , you know again I put in that same context , if you look at our So so overall guide , operating income will be up about 25% .

Jason Garland: If you look at our overall guide, operating income will be up about 25% if you exclude M&A and FX impact on again about a 16% non-Covid organic revenue growth. Again, a lot of good leverage there. If you look specifically, okay, why didn't some of the same sales or that sales drop all the way through? We highlighted about $2 million of one-time operating expenses that we saw in the quarter, primarily driven by some leadership changes that we've been making in our fit for growth journey. That is a hit there, a little bit of FX pressure as well. Finally, we will continue to make investments in infrastructure and lead as well as in operations to make sure that we have the right way to support future growth. We're taking really a long view here, Dan.

Speaker #6: If you exclude M&A and FX impact, on an organic basis, we saw about 16% non-COVID organic revenue growth. So again, a lot of good leverage there.

Speaker #6: If you look specifically okay , why didn't some of the same sales or that sales drop all the way You know we highlighted about $2 million of one time operating expenses that we saw in the quarter , primarily driven by some through .

Speaker #6: changes that we've been making in our fit for growth journey . So those that is a , you know , a hit there , a little bit of FX pressure as well .

Speaker #6: And then and then finally again we will continue to make investments in in in in , in the , in infrastructure and , and as well as an operations to make sure that we have the right way to support future growth .

Speaker #6: I we're taking really a long view here . Dan . Right . It's you know , at the total guide , you know , we dropped our EPs by about a penny , right .

Jason Garland: It's at the total guide, we dropped our EPS by about a penny. When you look at the midpoint and when we're thinking about that versus the investments we can make today to keep driving future growth, we're taking a really balanced view.

Speaker #6: When you look at the midpoint and when we're thinking about that versus the investments we can make today to keep driving future growth , we're taking a really balanced view .

Speaker #9: Understood . Thank you .

[Analyst]: Understood, thank you.

Speaker #6: Great . Thanks .

Jason Garland: Great, thanks.

Speaker #3: And our next question comes from the line of Matt LaRue with William Blair . Your line is open .

Operator: Your next question comes from the line of Matt LaRue with William Blair. Your line is open.

Speaker #10: Hi . Good morning Olivier . Maybe following up on Dan Harris's question relative to potential onshoring activity , or certainly a pickup in in the equipment opportunity over the next couple of years .

[Analyst]: Hi, good morning, Olivier. Maybe following up on Dan Harris's question relative to potential onshoring activity or certainly a pickup in the equipment opportunity over the next couple of years. Obviously it's still recent since some of the pharma tariff and MFN has come out. What do you make of any change in cadence or nature of customer conversations? How would you evaluate Repligen's ability today to potentially participate in larger scale projects relative to certainly before you joined but maybe five years ago when there was a resurgence in capital equipment related to Covid? Thanks.

Speaker #10: Obviously it's still recent since some of the pharma has come out . But what do you make of any change in cadence or nature of customer conversations ?

Speaker #10: And how would you evaluate REPLIGEN CORP ability ? Today to potentially participate in larger scale projects relative to , you know , certainly before you join , but , you know , maybe five years ago when there was a , a resurgence in capital equipment related to Covid , thanks .

Speaker #5: Yeah . Hey , good good morning . Matt . Yeah . No . Really good question . Obviously we're all very encouraged to see the couple of recent announcements that were taking place .

Olivier Loeillot: Good morning Matt. Yeah, no, really good question. Obviously we're all very encouraged to see the couple of recent announcements that were taking place, agreement between those two pharma company and the administration. You nailed it down very well. I mean the big difference for Repligen today versus where we were two to three years ago is we have become a real broad actor in the field of hardware solutions and we are now receiving RFPs for a lot of these big hardware investments that are happening around the world. Obviously these onshoring projects are going to represent a huge opportunity for all of us in the industry and for us in particular with our very differentiated hardware portfolio that is, as you know, very well combined with our PAT technology which is a huge differentiator. Yeah, we are starting to hear more about it.

Speaker #5: Agreement between those two pharma companies and the administration . You nailed it down very well . I mean , the big difference for Repligen today versus where we were 2 to 3 years ago or so , we have become a real broad actor in the field of hardware solutions , and we are now receiving RFPs for a lot of these big hardware investments that are happening around the world .

Speaker #5: So obviously , this onshoring projects are going to represent a huge opportunity for all of us in the industry and for us in particular , with our very differentiated hardware portfolio .

Speaker #5: That is , as you know , very well , combined with our Pat technology , which is a huge differentiator . So yeah , we are starting to hear more about it .

Speaker #5: We would expect probably our first orders to come toward the second half of 2026, and probably sales from 2027 onwards. And we're definitely going to be playing a big role in that exercise here, for sure.

Olivier Loeillot: We would expect probably first orders to come towards the second half of 2026 and probably sales from 2027-2028 onwards. We're definitely going to be playing a big role in that exercise here.

Speaker #3: And our next question comes from the line of Doug Schenkel with Wolfe Research . Your line is open .

Operator: Your next question comes from the line of Doug Schinkel with Wolfe Research. Your line is open.

Speaker #11: Good morning , everybody , and thank you for taking my questions . Really . Just a couple on guidance . So first , as I look back over the past four years , recognizing it's been a weird period , but if I if I just average things , revenue has been I think about 9% higher in Q4 versus Q3 on average .

[Analyst]: Good morning everybody and thank you for taking my questions. Really just a couple on guidance. First, you know, as I look back over the past four years, recognizing it's been a weird period, if I just average things, revenue has been I think about 9% higher in Q4 versus Q3 on average. I think guidance implies revenue is only about 2 to 3% higher in Q4 this year versus Q3. I'm guessing this is just conservatism given the environment we continue to be in. There is a lot of positive commentary here. You're coming off a good quarter, it's been a series of good quarters. I just want to make sure there's no timing dynamics that we should be contemplating. That's the first question. The second is, in your prepared remarks, I think you noted that we should expect filtration revenue growth at the lower end of the range.

Speaker #11: I think guidance implies revenues only about 2 to 3% higher in Q4 this year versus Q3 . I'm guessing this is just conservatism given the environment .

Speaker #11: We continue to be in a positive environment. But, you know, there's a lot of positive commentary here. You're coming off a good quarter.

Speaker #11: It's been a series of good quarters . So I just want to make sure there's no timing dynamics that we should be contemplating .

Speaker #11: So that's the first question . The second is in prepared remarks , I think you your noted that we should expect filtration revenue growth at the lower end of the range .

Speaker #11: And I just want to make sure I heard that right . If so , one , can you delineate between ATF and non ATF and two , what does that mean about product mix .

[Analyst]: I just want to make sure I heard that right. If so, one, can you delineate between ATF and non-ATF? Two, what does that mean about product mix more broadly, specifically, are resins tracking stronger than expected? Again, I may have just heard it wrong. Thank you.

Speaker #11: More broadly, specifically, are resins tracking stronger than expected? And again, I may have just heard it. Thank you.

Speaker #11: wrong .

Speaker #5: Hey doc . Yeah . So I think your two questions are somewhat linked to each other . So which is going to make it an easier answer here is if you look at seasonality this year , you're absolutely right .

Olivier Loeillot: Yeah. I think your two questions are somewhat linked to each other, which is going to make it an easier answer here. If you look at seasonality this year, you're absolutely right. We're seeing much less of it than we were seeing before COVID, and partly with that very strong Q3, which is very unusual because we've hardly ever seen a Q3 higher than a Q2 in the last 10 to 15 years. This means, obviously, there will be less seasonality also between Q3 and Q4. Our guidance now implies 8 to 13% organic growth in Q4. Keep in mind, we have about 3% headwind coming from that gene therapy customer that was reporting really high sales for us in Q4 of last year. That's really one of the main explanations.

Speaker #5: Like we're seeing much less of it than we were seeing before Covid . And and partly with that very strong quarter three , which is very unusual because we've hardly ever seen a Q3 higher than a Q2 in the last 10 to 15 years .

Speaker #5: I

Olivier Loeillot: By the way, this is purely filtration, which is why I was saying this is kind of also linked to the second part of your question here. The other two things to take into consideration here as well are the comp was much, much tougher, is much tougher in Q4 than it was in Q3, because comp is nine points more difficult sequentially than it was in Q3. That's another reason why you would imagine indeed that organic growth in Q4 would probably be more toward the 8 to 13% that we just talked about here. Back to filtration more specifically, we mentioned about that blockbuster ETF project we signed about a year ago. We delivered the hardware towards the end of Q3. This does play a little bit as well of a role in why there is a little bit less seasonality between Q3 and Q4.

Operator: Your next question comes from the line of Puneet Sudha with Lee Rink Partners. Your line is open.

[Analyst]: Yeah, hi Olivier and team. Thanks for taking my questions. I appreciate the momentum you're seeing here. It seems like six quarters of continued order growth, even sequentially, and the momentum you have here. Just trying to capture that for 2026, I think street is close to about 13% organic growth here. Given what you're seeing, is that sort of right number to think about? On the gene therapy side, you pointed out the headwinds for the second half this year. There was some more news on that yesterday. Not necessary. This is an in vivo product, so maybe it doesn't affect you from CRISPR, you know, CRISPR products. Just trying to understand, you know, how are you thinking about that piece of the modality overall for you and how should we expect that to trend in 2026? Thank you.

Olivier Loeillot: Thanks, Puneet. Starting with the first question, as usual, we'll provide 2026 guidance on our Q4 call as we typically do, meaning towards the end of February. What we said and obviously with the order growth we've seen now sequentially indeed for the last six quarters and being again growing more than 20% year over year, we were obviously very pleased with the situation. We're expanding this year and we are still aiming to pace industry growth by 5% over the medium term. This year we're probably going to be a bit higher than that 5%. We know that next year indeed we'll have a 200 basis point headwind from that specific gene therapy customer. That's where we are. We're going to give guidance really end of February. In terms of new modality, it's really playing out pretty much as we expected so far this year.

Olivier Loeillot: This is where the beauty of having a very diversified portfolio with more than 80% of our product going into monoclonal antibodies is a perfect sign of us being able to grow somewhere if for whatever reason we've got headwinds somewhere else. Outside of that specific gene therapy project, we've been experiencing a pretty good year. Yes, sometimes you get some bad news on one specific program, but then you're getting a couple of great news on some other programs. Even on the gene therapy side, beyond that specific program, there have been several announcements made over the last few months of significant funding of some of these programs and we are enjoying great opportunities with those different programs. What we've been doing really well this year, among others, is to diversify our focus on other types of new modalities.

Olivier Loeillot: Indeed, we've been a bit heavier on cell therapy and also on antibody drug conjugates since the beginning of this year. We've had numerous successes on both sides, which is something we're also very happy about here.

Your with more than 80% of our product going into monochrome antibodies, it's a perfect sign of of us being able to grow somewhere. If for whatever reason, we've got Edwin somewhere else. But but outside of that specific gene therapy project. I mean we we've been experiencing a pretty good year. I mean and yeah, some some time you get some bad news on 1, specific program, but then you get getting a couple of great news on some other programs and even on the gene therapy side, beyond that specific program. There have been several announcement, made over the last few months of significant, funding of of some of these program. And we are enjoying a great opportunities with those different programs. So what what we've been doing really well, this year among others is to diversify our focus on all the type of new modalities and indeed, we've been a bit heavier on cell therapy and also 1 antibody drug conjugates since the beginning of this year, and we've had numerous successes on both sides, which

Is something we're also very happy about here.

Operator: Your next question comes from the line of MACA Talk with Stephens Inc. Your line is open.

And your next question comes from the line of maca. Talk with Stevens, Inc. Your line is open.

[Analyst]: Hey, good morning. I appreciate you taking the questions, maybe just do for me. As you look at your geographical performance, specifically Asia Pacific, up 50% this quarter, I'd like to get a sense of how your recent investments in the region are trending, what variables are driving that performance, and given the long term strategic focus here, do you intend on investing additional resources in the region? Thank you. Yep.

Hey, good morning. I I appreciate you taking the questions. Uh, maybe just you from me but

Uh, as you look towards your geographical performance, specifically Asia-Pacific at 50% this quarter, I would like to get a sense of how your recent investments in the region are trending, what variables are driving that performance, and then, given the long-term strategic focus here.

do you intend on investing additional resources in the region?

Olivier Loeillot: Good morning, Mac. Yeah, great question. I mean Asia Pacific is representing approximately 15% of our sales on a full year basis, which is definitely too low. I mean, we know if you look, the benchmark from competition is anywhere between 20% and 25%. Being of this year, we all realize we have to start investing much more into the region. I like to separate China from the rest of Asia Pacific because China has been a very specific market. We decided to onboard a global leader for all of Asia, but also a new leader for China. We are really in the middle of implementing a pretty new and unique strategy on both sides. Without entering into details for China, really it's about rebuilding our team and also making sure we now tackle the much stronger local competition that exists today versus what was the situation before COVID.

Thank you.

Olivier Loeillot: On the other side, on the rest of Asia, it's really about building infrastructure. Infrastructure is from the different part of our business organization but also adding more people on the field to be able to deal more directly with customers. In some of the geographies, we're mostly going through distributors still. The two strategies we're developing are pretty different. We are enjoying very nice growth for already several quarters outside of China. It's pretty good to see China being back to growth in terms of sales this quarter. We still have a lot of homework to do down there. Yes, you're right, investment is on the list. We just literally opened our first office in Singapore yesterday. We're opening a new office in Japan in the next couple of weeks, and we are looking at some further investments across all of Asia over the next few quarters.

Yep. Good morning Mia. Great question. I mean Asia pack is representing approximately 15% of our sales, uh uh for on the full year basis which is definitely too low. I mean, we know, if you look The Benchmark from from competition is anywhere between 20 and 25%. So being of this year, we all realize we have to start investing much more into the region and its really. I, I like to separate China from the rest of Asia pack, because China has been a very specific market. So we've decided to onboard a global leader for all of Asia, but also a new leader for China and we are really in the middle of of implementing a pretty new and unique strategy on both sides and and without entering into details for China, really, it's about rebuilding, uh, our team and also making sure we we now tackles much stronger, local competition that exists today versus what was the situation before coid where on the other?

The side on on the rest of Asia, it's really about building infrastructure. And what's the infrastructure is from the different part of our business organization? But also adding more people on the field to be able to deal more directly with customers, where we're in some of these geographies where mostly going through Distributors still. And so, the 2 strategies were developing are pretty different. We are enjoying very nice growth for already several quarters outside of China. It's pretty good to see. China being back to growth in terms of sales this quarter but we still have a lot of homework to do down there and yes you're right. Investment is on on the list with just literally open our office, first office in Singapore. Yesterday we're opening a new office in Japan in the next couple of weeks and we are looking at some further Investments across all of Asia over the next few quarters.

Operator: Your next question comes from the line of Casey Woodring with JP Morgan. Your line is open.

And your next question comes from the line of Casey Woodring with JP Morgan. Your line is open.

[Analyst]: Great, thank you for taking my questions. Wanted to follow up on some of the ATF comments. You said you delivered hardware for the second blockbuster towards the end of Q3. Just wanted to understand if you would expect revenue to fall in Q4 or in 2026 or Q1 2026 there. My second question would just be, you called out emerging biotech revenue was the highest level you've seen in three years. Just talk towards trends there in terms of orders. You said you didn't really want to call out a trend there, but obviously significant improvements. Just any further color there? Thank you.

Great. Thank you for taking my questions. Um, I want to follow up on some of the ATF comments. So you said you delivered hardware for this second Blockbuster towards the end of Q3. I just want to understand if you would expect revenue to fall in Q4 or in Q1 2026 there. And then, you know, my second question would just be, you called out emerging biotech revenue as the highest level you've seen in.

years just talk towards uh Trends there and in terms of orders you said, you didn't really want to call out a

A trend there but obviously significant improvements. So I'm just any further color there. Thank you.

Olivier Loeillot: Yeah, no, on ATF, I'll start with the blockbuster first. Yes. The answer is we don't know yet for sure here, Casey.

Olivier Loeillot: I mean we have now delivered the equipment.

Olivier Loeillot: Now it's going to be about how long it takes them to really commission the line and have it up and running, and then depending from one customer to the other, they might decide to buy consumable earlier or later. At this stage we just don't know. I wouldn't think it's going to come as early as Q4, but maybe sometime mid of next year or so would sound like a reasonable time frame. Just before I move to new to small biotech, maybe just to add about ETF because I know everybody's very focused on that specific blockbuster. We continue to win a lot of late stage commercial customers, and we have a really very diversified customer base on at ETF. I mean we were probably designing in more than 50 late stage and commercial drugs today, and every quarter we are winning more.

Olivier Loeillot: We've got a really long runway for growth on ETF, which is very well supported by the order trends we've seen in the last few quarters. Going to small biotech, that was really the great surprise of the quarter. Obviously it's not a big part of our sales, it's less than 10%. To see it rebounding as much as we have seen it rebounding in Q3 was a really good surprise. We obviously connect the dots immediately with biotech funding, where biotech funding went from $9 billion in Q2 to €13 billion in Q3. We've seen finally some turnaround in terms of biotech funding. I would like to parry as well to a lot of M&A activities. You've seen a lot of pharma company acquiring some of these small mid sized biotech companies over the last few quarters.

Needle snakes. You also would sound like a reasonable time frame. Just before I moved to New to, to a small biotech, maybe just to add about 8 years. Because I know everybody's very focused on that specific Blockbuster. We, we continue to win a lot of late stage commercial customers and and we have a really, very Diversified customer base on ATF. I mean, we were probably designing in more than 50 late stage and Commercial drugs today and every quarter we are winning more. And so so we've got a really long runway for growth on ATF and which is very well supported by the other Trends, we've seen in the last few quarters. And and then going to a small biotech that was really the great surprise of the quarter. I mean, obviously it's not a big part of our of our service. It's less than 10%, but to see it rebounding. As much as we have seen. If we bonding in quarter 3, was a really good surprise and we obviously connect the dots immediately with biotech funding, where biotech funding went went from 9 billion US dollar.

Olivier Loeillot: I think that's also going to be a tailwind for the industry because that means probably more cash to be able to accelerate on some of these very promising early phase projects, which we are very, very eager to see progressing. That's another factor that we are very happy to see happening right now here.

In quality to to 13 billion euros are in quarter 3. Yeah, so we we've seen finally some turnaround in term of Biotech funding. I I would like to pair it as well to a lot of em many activities, you've seen a lot of Pharma company acquiring some of these small mid-size biotech company over the last few quarters. I think that's also going to be a Tailwind for the industry because that might means probably more cash to be able to accelerate on some of these very promising, early phase projects, which were very

Very, very eager to see progressing. So that's another factor that we were very happy to see happening right now here.

[Analyst]: Thank you.

Thank you.

Operator: Your next question comes from the line of Daniel Markowitz with Evercore ISI. Your line is open.

[Analyst]: Hey, good morning and thanks for taking my questions. I had a quick two-parter. First, I wanted to ask on the equipment strength. It was another quarter of really strong results, especially when you compare versus peers. I know there were some XCell ATF systems equipment placements. Is that what explains the better equipment trends versus peers, or would you say it's more broad based across different product lines as well? The second part, related, can you just remind us roughly the revenue contribution from these placements in Q3? As we look forward to 2026, how should we think about the consumable pull through and what this means for broader momentum in the XCell ATF systems product line? Thank you.

And your next question comes from the line of Daniel Markowitz with Evercore ISI. Your line is open.

Hey, good morning and thanks for taking my questions. Um, I had a quick 2-part

Olivier Loeillot: Yeah, I will spend more time on the first question because I won't answer the second one. Just seriously, I mean our capital equipment performance was obviously very encouraging. Our revenue grew more than 20% but our orders also grew high teens in the quarter. We were very happy about that. You're right, the main contributors of growth in Q3 were both XCell ATF systems, but also our analytical equipment. Honestly, the performance so far this year is really across the board. Maybe in Q3 downstream hardware was a little bit lower than both XCell ATF systems and analytics, but year to date it's really across the board that our orders have been doing really well, including downstream hardware as well. I like to repeat, we're seeing that hardware market from a very different angle than others. First of all, we are very small.

First, I wanted to ask on the equipment strength, it was another quarter of really strong results, especially when you compare versus peers, I know there were some ATF equipment. Placements. Is that what explains the better equipment, Trends versus peers? Or would you say it's more broad-based across different product lines as well? And then and then the second part related, um can you just remind us roughly the revenue contribution from these placements in 3Q and as we look forward to 2026 uh how should we think about the consumable pull through and and what this means for Broad and broader momentum in in the ATF product line. Thank you.

Yeah. So I always spend more time on the first question because I won't answer the second 1. So no just seriously. I mean our our Capital Equipment performance was obviously very encouraging. I mean our Revenue grew more than 20% but our orders also grew High Teens in the quarter so we were very happy about that. You're right. Like the main contributors of gross inquiry were both ATF but also our analytical equipment. So, but but honestly it the performance so far this year is really across

Olivier Loeillot: We're one of the newcomers in the field. Almost nowhere where we are today, two years, three years ago or so. We are seeing it definitely from a different angle. Also, keep in mind where we are differentiating ourselves a lot is that now we are also pairing our system with our PAT-enabled solutions. So far this year for downstream, one system out of four is now being paired with our PAT-enabled solutions. In fact, customers who bought hardware from competitors in the last few years are now coming to us, asking us to enable them to get access to our technologies as well. It's fair to say we haven't seen capital equipment spending return to historical levels yet globally.

The board. I mean uh, so maybe in quarter 3, Downstream Hardware was uh was a little bit lower than both ATF and analytics but year to date, it's really across the board that our orders have been doing really well, including a downstream Hardware as well. I, I, I like to repeat like we're seeing that uh, that Hardware Market from a very different angle than others. First of all, we are very small. I mean, we are 1 of the newcomer, in the field. I mean, almost nowhere where we are today, 2 years, 3 years ago or so. So we are seeing it definitely from a different angle, but also keeping in mind where we are differentiating ourselves a lot is that now we are also pairing our system with our P Technologies. And so far this year, for Downstream 1 system out of 4 is now being paired with our P Technologies. In fact, the customers who bought Hardware from competitors in in the last few years are now coming to us asking us to enable them to get access to our pet Technologies as well, but it's fair to say like pairs, we haven't seen capital

Olivier Loeillot: That's why I think all of us are very excited to see those onshoring projects coming in the next couple of years because that should accelerate overall market growth and for us be an extra opportunity to even grow further and faster than we do right now. As far as this specific XCell ATF systems project is concerned, I won't give any specific numbers, but it's only really a small part of the reason why we saw that very nice growth in the quarter. It wouldn't have changed the overall picture. Hardware performed very well for us in Q3.

Equipment spending return to historical level yet globally. Yeah. So that's, that's why I think all of us are very excited to see those on-shoring projects coming in the next couple of years because that should accelerate overall market growth and for us be an extra opportunity to even grow further and faster than we do right now. And then, as far as this specific ATF project is concerned, I I I won't give any specific numbers, but it's only really a, a, a small part.

[Analyst]: You.

Offer of the reason why we saw that very nice growth in the quarter, so it's not, it wouldn't have changed the overall picture like Hardware performed very well for us in quarter 3.

Operator: Your next question comes from the line of Brendan Smith with TD Cowen. Your line is open.

[Analyst]: Great, thanks guys. Congrats on the print. Good to see. Thanks for taking the questions. I actually wanted to just follow up quickly on some of the process analytics commentary and specifically what you've actually said recently about integrating the Maverick device from 908 Devices into ATF. For example, can you maybe just give us a little bit more color on where some of that stands? Maybe just thoughts on timing to that and to what extent that's maybe playing into how you're thinking about growth opportunities across the franchises, whether or not that kind of works out as expected. Thanks.

In your next question comes from the line of Brendan Smith with TD Cohen. Your line is open.

Olivier Loeillot: Yeah. Hey, good morning, Brendan. Yeah, no, obviously you heard us talking a lot about analytics. I mean, again, because it's a perfect showcase of the breadth of the portfolio we have. I have to say this year one of the most important launches we had was the SoloVPE Plus system, which is a real new generation of our at-line protein concentration piece of hardware. In Q3 this has just enabled us to sell the highest amount of units we've ever sold in the history of CTech. What's very encouraging is we have a very, very important install base and it's probably only less than a couple of portions of that install base that has been upgraded to the new SoloVPE Plus. You would think this is going to be a real big tailwind for us for the next several years here, which we are very excited about.

So I actually wanted to just follow up quickly on some of the process analytics commentary. Um, and and specifically what you've actually said recently about integrating the Maverick device from 908 into ATF, for example. Um, can you maybe just give us a little bit more color on where some of that stands, um, maybe just thoughts on on timing to that and and to, what extent that's maybe playing into, how you're thinking about growth opportunities across the franchises, whether or not that kind of works out as expected. Thanks.

Olivier Loeillot: The only other thing I would add on the CTech side is the first two quarters where we saw huge rebound on both consumables and services as well. We will start to have a lot of focus on services with the successes we're seeing here. It was great to see hardware now being back to this very high growth that we are experiencing and with a very strong funnel. As far as the 908 Devices is concerned, the integration is running as expected. We've merged now the two sales organizations and we start to see a really nice growing funnel for the 908 Devices part of the portfolio. We are progressing on the R&D side to combine ATF with Maverick. You'll hear us talking more about it in a quarter from now. At this stage it looks absolutely promising.

Yeah. Hey, good morning, Brendan ya know, obviously you heard us talking a lot about analytics. I mean and again because it's a perfect Showcase of the the breadth of the portfolio we have. But but really, I have to say this year, 1 of the most important launch, we had was the solo vpa plus, which is a real new generation of our outline protein concentration piece of hardware. And in quarter 3, this has just enabled us to sell the highest amount of units we've ever sold in the history of of cekc. And what what's what's very encouraging is? We have a very, very important install base and it's probably only less than a couple of portion of that install base that has been upgraded to, to the new solo VP plus. So, you would think like, this is going to be a real big Tailwind for us for, for, for the next several years here, which we are very excited about. And then the only other stuff I would add on, on the c tech side is the first 2 quarter, where we sold huge rebound on both consumable and services as

As well. And then we we start to have a lot of focus on services with the successes we are seeing here. But but it was great to see hardware and are being back to this very high growth that we are expanding and with a very strong funnel as far as the 9008 is concerned. I mean, the integration is running as expected. So we've merged now, the 2 sales organization and we start to see a really nice growing funnel for the 900 in part of the portfolio. And yeah, we are progressing uh on the R&D side to uh to combine ATF with the Maverick so you'll hear us talking more about it in a quarter from now. But at this stage it looks absolutely promising.

[Analyst]: Great, thank you.

Yeah.

Great. Thank you.

Operator: Your next question comes from the line of Anna Snoopkowski with KeyBanc Capital Markets. Your line is open. Good morning and congrats on the quarter. This is Anna on for Paul Knight and I have two questions. First, I think at recent conferences and your last quarter you mentioned strength in CDMOs and maybe more muted activity with those mid-sized CDMOs. I was wondering if we could get an update around mid-sized CDMOs and if you're seeing activity progressing there. My second question is on the protein side. I was wondering how the recent launches have been for your own resins and I think you mentioned some launching in the second half of this year, so maybe an update there. Thanks.

And your next question comes from the line of Anna Snoop Kowski with keybanc capital markets, your line is open.

Good morning and congrats on the quarter. Um, this is Anna on for Paul night and I have 2 questions so maybe first. Um I think at recent conferences and your last quarter you mentioned strengths in CD,

And maybe more muted activity with those mid-size CDMOs. So, I was wondering if we could get an update around mid-size CDMOs and if you're seeing activity progressing there.

And then my second question is on the protein side.

Olivier Loeillot: Good morning, Anna. Yeah, no, I mean on CDMOs again a really great quarter for us, both from a sales and an order point of view. We did mention the strength was particularly visible on the large scale CDMO. I have to tell you openly I didn't really specifically look at the mid sized one, so I can't answer you very specifically, but I know this quarter, really large scale CDMO was the one driving that more than 20% growth we had on the CDMO side as.

I was wondering how the recent launches have been for your own resins and I think you mentioned some launching in the second half of this year. So maybe an update there. Thanks.

Olivier Loeillot: far as proteins are concerned.

Hey, good morning, Anna. Yeah, no, I mean on CDA, most again of a really great quarter for us and Bubbles from the sales and and other point of view for we did mention like the strength was part to particularly visible on the large scale cdmo. So I have to tell you openly I I didn't really specifically look at the midsize ones, so I can't answer you very specifically but I know this quarter really large scale cdmos but the 1% growth we had on the cdmo side.

Olivier Loeillot: That was really one of the great surprises in the quarter because we expected protein growth to be pretty muted in Q3 and in fact it grew double digits. For me that was a great testimony of a very successful strategy that we started developing now two to three years ago where we had to switch from being a pure OEM partner, delivering protein elegance, to start developing custom ligand and custom resin with the acquisition of Tanti. The traction we're having on that side is absolutely great. The reason why we did even more than expected in Q3 on the protein side was because of chromatography resins. We know that the business can still be lumpy from quarter to quarter, but we're working on so many custom projects right now. We know that's going to become a huge tailwind for us over the next several years.

As far as protein is concerned, that was really 1 of the great surprise in the quarter because we expected a protein growth to be pretty muted in quarter 3. And in fact, it grew double digit. And, and for me, that was a great testimony of of a very successful strategy that we've started developing now, 2 to 3 years ago where we had to switch from being a pure OEM partner. Delivering, protein Elegance to start developing a custom Ligon and custom raisin with the acquisition of tantina. And I'm in the traction. We're having on that side is absolutely great. I mean the reason why we did even more than expected in quarter, 3, on the protein side was because of chromatography raisins. We know that the business

Olivier Loeillot: Just to close on product launches, we're still aiming to launch two to three new resins before the end of this year and we're going to make this announcement probably in the next couple of months. We are also having a pretty ambitious plan to launch several new resins in 2026. We really want to have both a broader catalog of products for new modalities, but also working more and more on custom projects on different types of application for big pharma customers as well here.

Some of us as well here.

Operator: Great, thank.

Great. Thank you.

[Analyst]: You.

Operator: Your next question comes from the line of Tom DeBorcey with Nephron Research. Your line is open.

And your next question comes from the line of Tom Dorsey with nephron research. Your line is open.

[Analyst]: Hey guys, thanks for taking the question. You mentioned the strategic accounts and 20, you know, key CDMO and pharma accounts, and just was wondering what trends in particular you're seeing at those accounts. Are you seeing similar strong equipment growth, and anything that I guess maybe differentiates those larger strategic accounts versus, I guess, the portfolio as a whole?

Hey guys, thanks for taking the question. Um, you bet. Should the, uh...

Olivier Loeillot: Yeah.

Strategic accounts and 20, you know, key cdmo and Pharma accounts. Just was wondering what Treads, uh, in particular, you're seeing at those accounts are you seeing similar, strong, uh, equipment growth and anything that I guess maybe differentiates those larger strategic accounts versus I guess? Uh, the portfolio as a whole

Olivier Loeillot: Good morning Tomi, great question. Strategic accounts have been an incredible success story for us, I have to say. It has really enabled us to really cross-sell our portfolio better and better. The equipment that you just mentioned is a perfect example. These accounts didn't really have a clue about what our capabilities were in terms of hardware. Probably a couple of years ago they knew us for XCell ATF systems, they knew us for OPUS pre-packed chromatography columns. Now, the vast majority of these people have either bought a couple of pieces of equipment, if not more than that, or at least had a chance to get trained on how to use our equipment and are now sending us RFPs for the big expansion they are working on.

Olivier Loeillot: Across the board, the strategic accounts have been really, really, really accretive to growth, both from the top point of view as well on the quarter. We are really delighted by the successes we've had. I know we mentioned several times for a company like ours which is very focused on innovation, we absolutely need to get access to the key decision makers. This is what this team of key account management has brought us over the last couple of years. Really delighted about the progress here.

Yeah, good morning Tomia. Great question. I mean, strategic accounts have been an incredible success story for us. I have to say, I mean, it has really enabled us to really cross sell our portfolio, better and better. And equipment that that you just mentioned is a perfect example. I mean, this accounts didn't really have a clue about what our capability were in term of Hardware. Probably a couple of years ago, they were for ATMs and us for for prepac column. Now, I mean, the vast majority of these people now have either bought, uh, a couple of pieces of equipment, if not more than that, or at least I've had a chance to get trained on how to use our equipment and are sending us rfps for for the big expansion. They are working on and but across the board strategic

Accounts have been really, really, really uh, uh, creative to growth both from the top line and from uh uh uh not as point of view as well on the quarter. So we are really delighted by the successes we've had and I, I know we mentioned several times for a company like ours, which is very focused on Innovation. We absolutely need to get access to the key decision makers. And this is, what is this team of Kan management has brought us over over the last couple of years. So really delighted about the progress here.

Operator: Your next question comes from the line of Luke Surgot with Barclays. Your line is open.

[Analyst]: Hey guys, thanks for the questions. I wanted to talk about the order between the new modalities versus the mAbs, especially as we're thinking into next year. From a second question, I want to think about if you guys are doing about 13% core and given all the moving pieces from investments and M&A and FX and tariffs, should we think about margin expansion opportunity next year, something like between 100 and 150 basis points versus something north of that, a more normalized environment.

And your next question comes from the line of Luke Sergot with Barclays. Your line is open.

Hey guys, thanks for the questions. Um, so I wanted to talk about the, the order, uh, between the new modalities versus the maps, especially as we're thinking in the next year. And then from a second question, I want to think about, all right, if if you guys are doing about 13% core and given the all the moving pieces from Investments and uh, m&a and, you know, FX and tariffs, like should we think about margin expansion opportunity next year or something like between like a 100 and 150 basis points versus

You know, something north of that. I'm more normalized environment.

Olivier Loeillot: What was the first question here?

Jacob Johnson: Orders for new modalities versus monoclonal antibodies?

Olivier Loeillot: Yeah, no, I mean new modalities.

Olivier Loeillot: I think we mentioned earlier, new modality really played out pretty much as expected in Q3, meaning we expected muted demand and that's more or less what we experienced. Obviously, we've got now significant headwind in the second half of this year because of that gene therapy program. Outside of that one, we've been doing pretty well. Year to date, sales are growing mid single digits and year to date revenue of new modality is about 17% of our total portfolio. It's down a little bit versus last year but still pretty much on par. In terms of margin, I'll let Jason comment here.

Jason Garland: Yeah, again we'll provide more guidance in our Q4 call as we normally do. Again, I'd expect our gross margin to continue to expand at the rate that we've been talking about, and then we'll drive to get additional operating leverage at the EBIT level as well. This constant balance of driving margin expansion while investing for the growth that we see ahead of us gives a well-rounded view on that.

All right. Let's go to the first question. Yeah. Or orders for new modalities versus maps? Yeah. No. I mean new modalities. I think we mentioned earlier. New modality really played out pretty much as expected in quarter 3. I mean, meaning we expected muted demand and that's more or less what we experience. But obviously we've got now a significant headwind in the second half of this year because of that gene therapy program outside of that 1. I mean, we've been doing pretty well. I mean year to date sales are growing mid, single digit, and to year to date, revenue of new modalities about 17% of our total portfolio. So it's down a little bit versus last year, but but still pretty much on par and then in term of marching, I'll let Jason come here. Yeah. And again and we'll, we'll provide more guidance and, um, you know, our our 4 call um, as we normally do. But, but again it I'd expect, uh, our gross margin to continue to expand at the rate that we've been talking about and then we'll drive to get. Um, you know,

[Analyst]: Great, thanks.

Additional operating leverage at the at the easy level, as well. So, um, again, with this content balance of, of driving margin expansion while investing uh, for the growth that that we see, um, ahead of us. So I think a well-rounded view on that

Great, thanks.

Operator: Your next question comes from the line of Brandon Couliard with Wells Fargo. Your line is open.

[Analyst]: Hey, thanks. Good morning Jason, just real quick, would you quantify what's embedded in the guide for net pricing this year and quantify the tariffs, surcharges, and whether or not those may or may not recur in 2026. Thanks.

And your next question comes from the line of Brandon Cooley with Wells. Fargo, your line is open.

Jason Garland: Yeah, the price is, it's been pretty consistent at this low single digit. We've seen that through the year and expect that to wrap up in Q4 as well, embedded in the overall guide, you know, and really kind of see that as we move forward for tariffs. Again, minimal impact in 2025, couple million or so from a surcharge side in terms of hey, I see the sales but I'm going to have an equal amount of cost. From what we see today, you know, I don't think that changes much next year. Every day, every day we see new headlines. We'll continue to watch that but still see a little bit of, I'll say marginal dilution at the profit level with tariffs as surcharges will remain. Thanks Brandon.

Hey thanks. Good morning. Uh, Jason just real quick. Um, would you quantify what's embedded in the guide for net pricing this year and get a quantify the tariffs or charges and whether or not those may or may not recur? Uh, in 26. Thanks.

An equal amount of cost. Um, and again, from what we see today, you know, I don't think that changes much next year, um, you know, every day every day we see new headlines, so we'll continue to watch that, but but still see a little bit of, I'll say marginal dilution at the, at the profit level with tariffs, uh, as Sir charges will remain.

Thanks Brandon.

Operator: I would now like to turn the call back over to Olivier Loeillot.

And I would now like to turn the call back over to Olivier, Leo.

Olivier Loeillot: Hey. Many thanks for joining our call today. I really want to congratulate our Repligen team for executing brilliantly in Q3. We are really looking forward to meeting you all at the upcoming conference. Have a great day today.

Hey. Well, my name is Today. I really want to congratulate our Replicant team for executing brilliantly in Q3. We are really looking forward to meeting you all at the upcoming conference. Have a great day today.

Operator: This concludes today's conference call. You may now disconnect.

and this concludes today's conference call, you may now disconnect