Azenta Q1 2026 Azenta Inc Earnings Call | AllMind AI Earnings | AllMind AI
Q1 2026 Azenta Inc Earnings Call
Will be in listen, only mode afterwards. We will conduct a question and answer session.
At that time, if you have a question, please press the star, followed by 1 on your telephone.
As a reminder, this conference is being recorded Wednesday, February, 4th, 2026.
I will now turn the conference over to Ivan Peron vice president fpna and investor relations.
Thank you, operator. And good morning to everyone on the line. Today, we would like to welcome you to our earnings conference call for the first quarter of fiscal year 2026.
Our first quarter earnings press release was issued before the open of the market today and is available on our investor relations website located at investors. Azenta.com in addition to the supplementary PowerPoint slides, that will be used during the prepared remarks today.
Please note, that effective, the first fiscal quarter of 2025 the results of the medical systems are treated as discontinued operations.
I would like to remind everyone that during the course of the call, we will be making a number of forward-looking statements within the meaning of the private litigation Securities Act of 1995.
There are many factors that may cause actual Financial results or other events to differ from those identified in such forward-looking statements.
I would refer you to the section of our earnings release titled, Safe, Harbor statement, the safe harbor side, on the aforementioned PowerPoint presentation on our website, and on our various filings with the SEC, including our annual reports on form, 10K, and our quarterly reports on form 10q.
We make no obligation to update. These statements should future financial data or events occur that differ from the forward-looking statements presented today.
We may refer to a number of non-gaap financial measures which are used in addition to and in conjunction with results. Presented in accordance with gaap.
We believe the non-gaap measures provide an additional way of viewing aspects of our operations and performance. But when considered with gaap financial results and the reconciliation of gaap measures, they provide an even more complete understanding of the aenta business.
Non-gaap measure should not be relied upon to the exclusion of the Gap measures themselves.
On the call with me today is our president and chief executive officer, John marotta, and Executive Vice, President and Chief Financial Officer Lauren Slim.
We will open the call with remarks from John. Then Lawrence will provide a detailed look into our financial results, and our outlook for fiscal year 2026.
We will then take your questions at the end of the prepared. Remarks.
With that, I would like to turn the call over to our CEO John marotta.
Thank you, Ivonne, good morning, everyone. And thank you for joining us today for our first quarter earnings call.
As we start fiscal 2026, I want to acknowledge the focus, discipline and execution, our teams continue to demonstrate across the zenta
Their commitment to serving our customers and continuously improving how we operate is Central to our momentum and is driving meaningful progress across the business.
Because of their efforts. We are entering the year. Well, positioned for continued success.
Together. We are building a stronger, more agile, and high-performing, aenta.
As I've said before our turnaround continues and it will not be a straight line. No turnaround is
After establishing, a stronger organization, and structural Foundation. Last year, we are accelerating efforts to streamline processes and it elevate performance.
While macro conditions remain mixed. We enter the year with a much stronger Foundation, clearer accountability, and a sharper strategic Focus.
This is the playbook for a successful turnaround and I am confident in the path. We are taking
our priorities for 2026 are clear. Embed operational excellence throughout the organization, accelerate growth and expand margins, and the Strategic and discipline Capital deployment.
These are the pillars that will drive azenta to outperform the market and deliver long-term value creation for our customers employees, and our shareholders.
In the first quarter, organic Revenue declined in line with our expectations down approximately 1%.
Mia and government funding and those Dynamics largely played out as anticipated.
For a market perspective, conditions remain uneven Capital spending decisions. Continue to be cautious across parts of the life sciences ecosystem.
We see positive momentum across Europe. And while the US is still slow, we are cautiously optimistic with Improvement in the capital markets as well as renewed m&a activity.
Bookings. During the quarter were impacted by weak Capital spending and the government shutdown at the end of the calendar year.
While this is causing timing shifts, we expect these orders to be recognized in the future quarters, and do not anticipate it to impact the full year results.
Over the coming months. We expect greater Clarity around government academic funding, which we believe will offer greater stability across and markets broadly.
2026 is shaping up to be a transitional year for the life sciences sector with macro conditions, and sentiment being mixed yet, the underlying industry Tailwinds remain consistent.
Last year, we demonstrated a zent's ability to deliver on our commitments, even in a challenging environment proving that we can execute with discipline and precision.
These strengths provide a solid foundation as we advance our turnaround initiatives this year.
We anticipate acceleration in the second half of 2026. As delayed approvals are processed, capital investment ramps, and our growth Investments, begin to take hold.
Importantly, the current environment highlights. Why aent is the partner of choice for Life Sciences. Customers navigating complexity and change.
Our differentiated Solutions and deep expertise uniquely positioned essensa to help our customers optimize operations accelerate Innovation and manage resources. More effectively. We are the trusted partner for organization seeking scale reliability. And differentiation with an expert team. That knows the science understands the workflows and delivers results for our customers.
The combination of expertise technology and operational discipline enables the zenta to turn challenges into opportunities.
Operational excellence is the engine behind everything. We do the azenta business system continues to guide. How we operate driving measurable improvements in. On-time delivery quality and productivity across operations, commercial, and support functions.
During the quarter, we Advanced ABS deployment through kaizens, daily management routines, and problem solving that are taking route.
teams across the organization are embracing a continuous Improvement, mindset proactively identifying opportunities, and shaping solutions that enhance, efficiency, and execution companywide,
ABS is not just a set of processes, it's a differentiator for a zenta enabling sustainable. Scalable operational excellence that supports both growth and margin expansion, and reinforces our ability to deliver for our customers and our shareholders alike.
We also continue to benefit from the simplified and decentralized operating model implemented last year.
Clearer accountability at the operating company level supports faster decision-making. And more disciplined execution. Productivity gains are being reinvested in line with our priorities including commercial Excellence, Innovation and customer-facing capabilities.
Our core growth investments in scaling bio, repositories regionalized synthesis and investing in technology and automation are gaining traction.
During the quarter, we announced the definitive agreement for the sale of B, Medical, which is expected to close on, or before, March 31st.
This transaction, further sharpens, our focus on our core portfolio of differentiated Solutions and enhances our financial flexibility. Supporting our strategic approach to Future Capital allocation.
Combined with the 250 million share repurchase authorization announced at investor day. These actions, reflect our ongoing commitment to delivering value to our shareholders while strategically deploying capital.
Let me cover a bit more in the first quarter of performance in our full year outlook.
As expected on a year-over-year basis. Organic Revenue declined. Approximately 1%
And Gene synthesis showed growth.
Reflecting continued customer demand for advanced workflows and the value of our differentiated Solutions.
John Marotta: solutions and enhances our financial flexibility, supporting our strategic approach to future capital allocation. Combined with the $250 million share repurchase authorization announced at Investor Day, these actions reflect our ongoing commitment to delivering value to our shareholders while strategically deploying capital. Let me cover a bit more on the Q1 performance and our full year outlook. As expected, on a year-over-year basis, organic revenue declined approximately 1%. Within Multiomics, next-generation sequencing and gene synthesis showed growth, reflecting continued customer demand for advanced workflows and the value of our differentiated solutions. In sample management solutions, we saw solid growth in biorepositories, demonstrating strong execution and sustained customer adoption, while our automated solutions line remained under pressure, particularly in stores, due to ongoing budget constraints. As I've said, turnarounds are never linear and may be lumpy.
John Marotta: solutions and enhances our financial flexibility, supporting our strategic approach to future capital allocation. Combined with the $250 million share repurchase authorization announced at Investor Day, these actions reflect our ongoing commitment to delivering value to our shareholders while strategically deploying capital. Let me cover a bit more on the Q1 performance and our full year outlook. As expected, on a year-over-year basis, organic revenue declined approximately 1%. Within Multiomics, next-generation sequencing and gene synthesis showed growth, reflecting continued customer demand for advanced workflows and the value of our differentiated solutions. In sample management solutions, we saw solid growth in biorepositories, demonstrating strong execution and sustained customer adoption, while our automated solutions line remained under pressure, particularly in stores, due to ongoing budget constraints. As I've said, turnarounds are never linear and may be lumpy.
Strategic approach to future capital allocation combined with the $250 million share repurchase authorization announced at Investor Day. These actions reflect our ongoing commitment to delivering value to our shareholders, while strategically deploying capital.
In Sample, Management Solutions, we saw solid growth in BIO, repositories demonstrating, strong execution, and sustained customer adoption, while our automated Solutions line remained Under Pressure. Particularly in stores, due to ongoing budget, constraints,
Let me cover a bit more in the first quarter performance and our full year outlook.
As expected on a year over year basis organic revenue declined approximately 1%.
As I've said, turnarounds are never linear and may be lumpy in the quarter. We faced higher costs in automated stores on late stage projects related to quality issues that remain from last year. We're working closely with our customers to make it right and expect to lapse these issues post the second quarter
Within multi Omics next generation sequencing and gene synthesis showed growth.
and multiomics, we experience Regional mixed Dynamics with softness in North America leading to lab and efficiency
Reflecting continued customer demand for advanced workflows, and the value of our differentiated solutions.
In sample management solutions, we saw solid growth in bio repositories, demonstrating strong execution and sustained customer adoption, while our automated solutions line remained under pressure, particularly in stores due to ongoing budget constraints.
We are taking decisive actions to address these pressures. We expect margins to improve as we progress through the second half of the year and execute on the transformation of our company.
Lawrence will go into more detail on our quarterly, financial performance.
lastly, as you know, we do not guide quarterly our operating rhythm, in the businesses to drive performance is monthly
As I've said turnarounds are never linear and may be lumpy in the quarter, we faced higher costs in automated stores on late stage projects related to quality issues that remained from last year. We are working closely with our customers to make it right and expect to lap these issues post the second quarter.
John Marotta: In the quarter, we faced higher costs in automated stores on late-stage projects related to quality issues that remained from last year. We're working closely with our customers to make it right and expect to lapse these issues post Q2. In Multiomics, we experienced regional mixed dynamics, with softness in North America leading to lab inefficiency. We are taking decisive actions to address these pressures. We expect margins to improve as we progress through the second half of the year and execute on the transformation of our company. Lawrence will go into more detail on our quarterly financial performance. Lastly, as you know, we do not guide quarterly. Our operating rhythm in the businesses to drive performance is monthly.
John Marotta: In the quarter, we faced higher costs in automated stores on late-stage projects related to quality issues that remained from last year. We're working closely with our customers to make it right and expect to lapse these issues post Q2. In Multiomics, we experienced regional mixed dynamics, with softness in North America leading to lab inefficiency. We are taking decisive actions to address these pressures. We expect margins to improve as we progress through the second half of the year and execute on the transformation of our company. Lawrence will go into more detail on our quarterly financial performance. Lastly, as you know, we do not guide quarterly. Our operating rhythm in the businesses to drive performance is monthly.
Yes. Our job just got harder and looking ahead. We are committed to our full year. 2026 guidance of 3 to 5% organic Revenue growth and adjusted ebit down margin expansion of approximately 300 basis points.
And multi omics, we experienced regional mix dynamics with softness in North America, leading to lab inefficiency.
We are taking decisive actions to address these pressures, we expect margins to improve as we progress through the second half of the year and execute on the transformation of our company.
While macro conditions remain mixed. We view 2026 as a transitional year for the sector. And we are confident that our initiatives including the revamped commercial engine, strong leadership, and discipline execution will gain traction as the year progresses.
With that, I'll turn it over to the Lawrence to walk through the financials in more detail.
Lawrence will go into more detail on our quarterly financial performance.
Lastly, as you know, we do not guide quarterly our operating rhythm and the businesses to drive performance is monthly.
Thank you, John, and good morning. I'll be going with our q1 2026, fiscal results and the key financial drivers. Then cover our segment performance our balance sheet and fiscal 2026 guidance.
John Marotta: Yes, our job just got harder, and looking ahead, we are committed to our full year 2026 guidance of 3% to 5% organic revenue growth and Adjusted EBITDA margin expansion of approximately 300 basis points. While macro conditions remain mixed, we view 2026 as a transitional year for the sector, and we are confident that our initiatives, including the revamped commercial engine, strong leadership, and disciplined execution, will gain traction as the year progresses. With that, I'll turn it over to Lawrence to walk through the financials in more detail.
John Marotta: Yes, our job just got harder, and looking ahead, we are committed to our full year 2026 guidance of 3% to 5% organic revenue growth and Adjusted EBITDA margin expansion of approximately 300 basis points. While macro conditions remain mixed, we view 2026 as a transitional year for the sector, and we are confident that our initiatives, including the revamped commercial engine, strong leadership, and disciplined execution, will gain traction as the year progresses. With that, I'll turn it over to Lawrence to walk through the financials in more detail.
Yes, our job just got harder and looking ahead, we are committed to our full year 2026 guidance of 3% to 5% organic revenue growth and adjusted EBITDA margin expansion of approximately 300 basis points.
Today's results include B Medical Systems, which is classified in discontinued operations, unless stated otherwise.
During the quarter, we recorded an additional 10 million non-cash, Lots related to assets, held for sale.
While macro conditions remain mixed we view 2026 as a transitional year for the sector and we are confident that our initiatives, including the revamped commercial engine strong leadership and disciplined execution will gain traction as the year progresses.
Ask communicated in December, we expect the sale to close on or before March 31st 2026.
To supplement my remarks. Today, I will refer to the slide deck available on our website.
With that I'll turn it over to Lawrence to walk through the financials in more detail.
Turning to slide 3. Total revenue was 149 million up, 1% reported and down. 1% organically with a 2% headwind from foreign exchange.
Lawrence Lin: Thank you, John, and good morning. I'll begin with our Q1 2026 fiscal results and the key financial drivers, then cover segment performance, our balance sheet, and fiscal 2026 guidance. Today's results exclude B Medical Systems, which is classified in discontinued operations, unless stated otherwise. During the quarter, we recorded an additional $10 million non-cash loss related to assets held for sale. As communicated in December, we expect the sale to close on or before 31 March 2026. To supplement my remarks today, I will refer to the slide deck available on our website. Turning to Slide 3, total revenue was $149 million, up 1% reported and down 1% organically, with a 2% headwind from foreign exchange. Results reflect mixed performance across the portfolio, with strong growth in biorepositories and next-generation sequencing, partially offset by softness in our capital-intensive businesses.
Lawrence Lin: Thank you, John, and good morning. I'll begin with our Q1 2026 fiscal results and the key financial drivers, then cover segment performance, our balance sheet, and fiscal 2026 guidance. Today's results exclude B Medical Systems, which is classified in discontinued operations, unless stated otherwise. During the quarter, we recorded an additional $10 million non-cash loss related to assets held for sale. As communicated in December, we expect the sale to close on or before 31 March 2026. To supplement my remarks today, I will refer to the slide deck available on our website. Turning to Slide three, total revenue was $149 million, up 1% reported and down 1% organically, with a 2% headwind from foreign exchange. Results reflect mixed performance across the portfolio, with strong growth in biorepositories and next-generation sequencing, partially offset by softness in our capital-intensive businesses.
Thank you John and good morning, I'll begin with our Q1 2026 fiscal results and the key financial drivers then cover segment performance our balance sheet in fiscal 2026 guidance.
Results. Reflect mixed performance across the portfolio with strong growth in bile repositories. And Next Generation sequencing partially offset by softness in our Capital intensive businesses.
Today's results include <unk> systems, which is classified in discontinued operations unless stated otherwise.
Overall, these Trends are consistent with our initial expectations for the quarter, and reflect the impact of the continued uncertainty in the macro environment.
During the quarter, we recorded an additional $10 million noncash loss related to assets held for sale.
Non-gaap EPS for the first quarter was 9 cents.
As communicated in December we expect the sale to close on or before March 31 2026.
Adjusted. Ebita margins was 8.5% down approximately 230 basis points year-over-year impacted by pressures and gross margin.
To supplement my remarks today I will refer to the slide deck available on our website.
despite this, we remain confident in the opportunity for margin expansion in 2026 and Beyond,
Turning to slide three total revenue was $149 million up 1% reported and down 1% organically with a 2% headwind from foreign exchange.
We are focused on leveraging disciplined cost management. While optimizing operations as we continue transforming the company.
Results reflect mixed performance across the portfolio with strong growth in bio repositories and next generation sequencing, partially offset by softness in our capital intensive businesses.
Free cash flow including B, Medical was 15 million for the quarter driven by increased customer deposits and deferred revenue partially offset by usage in working capital.
Lawrence Lin: Overall, these trends are consistent with our initial expectations for the quarter and reflect the impact of the continued uncertainty in the macro environment. Non-GAAP EPS for Q1 was $0.09. Adjusted EBITDA margins was 8.5%, down approximately 230 basis points year-over-year, impacted by pressures in gross margin. Despite this, we remain confident in the opportunity for margin expansion in 2026 and beyond. We are focused on leveraging disciplined cost management while optimizing operations as we continue transforming the company. Free cash flow, including B Medical, was $15 million for the quarter, driven by increased customer deposits and deferred revenue, partially offset by usage and working capital. We ended the quarter in a strong financial position, with $571 million in cash, cash equivalents, and marketable securities, an increase of $25 million quarter-over-quarter.
Lawrence Lin: Overall, these trends are consistent with our initial expectations for the quarter and reflect the impact of the continued uncertainty in the macro environment. Non-GAAP EPS for Q1 was $0.09. Adjusted EBITDA margins was 8.5%, down approximately 230 basis points year-over-year, impacted by pressures in gross margin. Despite this, we remain confident in the opportunity for margin expansion in 2026 and beyond. We are focused on leveraging disciplined cost management while optimizing operations as we continue transforming the company. Free cash flow, including B Medical, was $15 million for the quarter, driven by increased customer deposits and deferred revenue, partially offset by usage and working capital. We ended the quarter in a strong financial position, with $571 million in cash, cash equivalents, and marketable securities, an increase of $25 million quarter-over-quarter.
Overall these trends are consistent with our initial expectations for the quarter and reflect the impact of the continued uncertainty in the macro environment non.
We ended the quarter in a strong financial position with 571 million in cash. Cash, equivalents and marketable securities, an increase of 25 million quarter to quarter.
non-GAAP EPS for the first quarter was nine.
This provides us with the flexibility to deploy capital and return value to our shareholders as we progress through 2026.
Adjusted EBITDA margin was eight 5% down approximately 230 basis points year over year impacted by pressures in gross margin <unk>.
in December 2025, our board approved the 250 million share repurchase authorization
Despite this we remain confident in the opportunity for margin expansion in 2026 and beyond.
We remain committed to maintaining Financial flexibility to support. Discipline strategic Capital deployment, that drives long-term value creation.
We are focused on leveraging disciplined cost management, while optimizing operations as we continued transforming the company.
Now, let's turn to slide 4 to take a deeper. Look at our results in the quarter.
Free cash flow, including be medical was $15 million for the quarter driven by increased customer deposits and deferred revenue, partially offset by usage in working capital.
Total revenue was 149 million up. 1% reported and down. 1% organically with a 2% headwind, from foreign exchange.
We ended the quarter in a strong financial position with $571 million in cash cash equivalents and marketable securities an increase of 25 million quarter to quarter.
Lawrence Lin: This provides us with the flexibility to deploy capital and return value to our shareholders as we progress through 2026. In December 2025, our board approved a $250 million share repurchase authorization. We remain committed to maintaining financial flexibility to support disciplined, strategic capital deployment that drives long-term value creation. Now, let's turn to Slide 4 to take a deeper look at our results in the quarter. Total revenue was $149 million, up 1% reported and down 1% organically, with a 2% headwind from foreign exchange. Multiomics was supported by next-generation sequencing, which contributed to year-over-year growth, as well as gains in gene synthesis, which was partially offset by continued softness in Sanger sequencing. Within sample management solutions, growth in biorepositories, consumables, and instruments was offset by a decline in automated stores and cryo.
Lawrence Lin: This provides us with the flexibility to deploy capital and return value to our shareholders as we progress through 2026. In December 2025, our board approved a $250 million share repurchase authorization. We remain committed to maintaining financial flexibility to support disciplined, strategic capital deployment that drives long-term value creation. Now, let's turn to Slide four to take a deeper look at our results in the quarter. Total revenue was $149 million, up 1% reported and down 1% organically, with a 2% headwind from foreign exchange. Multiomics was supported by next-generation sequencing, which contributed to year-over-year growth, as well as gains in gene synthesis, which was partially offset by continued softness in Sanger sequencing. Within sample management solutions, growth in biorepositories, consumables, and instruments was offset by a decline in automated stores and cryo.
This provides us with the flexibility to deploy capital and returned value to our shareholders as we progress through 2026.
then sample Management, Solutions growth in BIO repositories, and consumables and instruments was offset by a decline, in automated storage, and cryo,
In December 2025, our board approved a $250 million share repurchase authorization.
Overall, these Trends are consistent with our expectations, reflecting macro uncertainty.
We remain committed to maintaining financial flexibility to support disciplined strategic capital deployment that drives long term value creation.
Now, let's turn to slide four to take a deeper look at our results in the quarter.
Total revenue was $149 million up 1% reported and down 1% organically with a 2% headwind from foreign exchange <unk>.
Turning to gross margin. We delivered 44.1% for the quarter down 360 basis points versus the prior year. The decline was primarily due to underutilized lab capacity driven by lower North. America volumes coupled with additional costs related to rework on several automated storage projects
Multi omics was supported by next generation sequencing, which contributed to year over year growth as well as gains and gene synthesis, which was partially offset by continued softness in sanger sequencing.
Despite these headwinds, we continue to make meaningful progress. On our ABS efficiency initiatives that positions us well for margin expansion over time.
Within sample management solutions growth in bio repositories, and consumables and instruments was offset by a decline in automated stores in cryo.
Adjust the ibida was 13. Million representing a 8.5% margin. A contraction of approximately 230 basis. Points driven by the gross margin pressures. I just described
Lawrence Lin: Overall, these trends are consistent with our expectations, reflecting macro uncertainty. Turning to gross margin, we delivered 44.1% for the quarter, down 360 basis points versus the prior year. The decline was primarily due to underutilized lab capacity, driven by lower North America volumes, coupled with additional costs related to rework on several automated stores projects. Despite these headwinds, we continue to make meaningful progress on our ABS efficiency initiatives that positions us well for margin expansion over time. Adjusted EBITDA was $13 million, representing an 8.5% margin, a contraction of approximately 230 basis points, driven by the gross margin pressures I just described. Our operational transformation and disciplined cost management journey continues, as evidenced in the $5 million decline in SG&A year over year, and more importantly, in G&A.
Lawrence Lin: Overall, these trends are consistent with our expectations, reflecting macro uncertainty. Turning to gross margin, we delivered 44.1% for the quarter, down 360 basis points versus the prior year. The decline was primarily due to underutilized lab capacity, driven by lower North America volumes, coupled with additional costs related to rework on several automated stores projects. Despite these headwinds, we continue to make meaningful progress on our ABS efficiency initiatives that positions us well for margin expansion over time. Adjusted EBITDA was $13 million, representing an 8.5% margin, a contraction of approximately 230 basis points, driven by the gross margin pressures I just described. Our operational transformation and disciplined cost management journey continues, as evidenced in the $5 million decline in SG&A year over year, and more importantly, in G&A.
Overall, these trends are consistent with our expectations, reflecting macro uncertainty.
Turning to gross margin, we delivered 44, 1% for the quarter down 360 basis points versus the prior year the.
our operational transformation and discipline cost management Journey continues as evidence in the 5 million decline in sgna year-over-year and more importantly in GNA.
Again, non-gaap EPS for the first quarter was 9 cents per share.
The decline was primarily due to underutilized lab capacity driven by lower North America volumes, coupled with additional costs related to rework on several automated storage projects.
With that. Let's turn to slide 5 for a review of our segments, quarterly results. Starting with sample Management, Solutions for SMS.
Despite these headwinds we continue to make meaningful progress on our ABS efficiency initiatives that positions us well for margin expansion over time.
sample Management, Solutions, delivered revenue of 81 million for the quarter flat on a reported basis and down, 2% organically,
Adjusted EBITDA was $13 million.
Growth in BIO repositories demonstrated, strong momentum with early wins in our commercial growth initiatives.
Representing eight 5% margin a contraction of approximately 230 basis points driven by the gross margin pressures I just described.
This growth was partially offset by expected softness in automated source and cryo due to slower. Bookings. From macro driven budget constraints.
Our operational transformation and disciplined cost management journey continues as evidenced in the $5 million decline in SG&A year over year and more importantly in G&A.
Consumables and instruments, delivered modest year-over-year growth reflecting steady demand and the ongoing contribution of these products to the overall portfolio.
Lawrence Lin: Again, Non-GAAP EPS for the first quarter was $0.09 per share. With that, let's turn to slide 5 for a review of our segment quarterly results, starting with Sample Management Solutions, or SMS. Sample Management Solutions delivered revenue of $81 million for the quarter, flat on a reported basis, and down 2% organically. Growth in biorepositories demonstrated strong momentum with early wins in our commercial growth initiatives. This growth was partially offset by expected softness in automated stores and cryo due to slower bookings from macro-driven budget constraints. Consumables and instruments delivered modest year-over-year growth, reflecting steady demand and the ongoing contribution of these products to the overall portfolio. Turning to gross margin for Sample Management Solutions, we delivered 45.4% for the quarter, down 370 basis points versus the prior year.
Lawrence Lin: Again, Non-GAAP EPS for the first quarter was $0.09 per share. With that, let's turn to slide 5 for a review of our segment quarterly results, starting with Sample Management Solutions, or SMS. Sample Management Solutions delivered revenue of $81 million for the quarter, flat on a reported basis, and down 2% organically. Growth in biorepositories demonstrated strong momentum with early wins in our commercial growth initiatives. This growth was partially offset by expected softness in automated stores and cryo due to slower bookings from macro-driven budget constraints. Consumables and instruments delivered modest year-over-year growth, reflecting steady demand and the ongoing contribution of these products to the overall portfolio. Turning to gross margin for Sample Management Solutions, we delivered 45.4% for the quarter, down 370 basis points versus the prior year.
<unk> non-GAAP EPS for the first quarter was <unk> <unk> per share.
With that let's turn to slide five for a review of our segment quarterly results, starting with sample management solutions or SMS. Therefore.
Sample management solutions delivered revenue of $81 million for the quarter flat on a reported basis and down 2% organically.
Turning to gross margin for sample Management Solutions. We delivered 45.4% for the quarter down 370 basis points versus the prior year. The decline was primarily driven by higher rework. Costs, incurred on automated stores projects and the negative impacts of a non-recurring item.
The incremental automated Source costs stems from quality issues that we have been addressing through targeted efforts with our customers.
And bio repositories demonstrated strong momentum with early wins in our commercial growth initiatives.
This growth was partially offset by expected softness in automated source and cryo due to slower bookings from macro driven budget constraints.
we expect our remediation efforts to be completed by the end of the second quarter, and to incur a full year estimate impact between 3 million to 5 million
Turning next to the multi-omic segment.
<unk> and instruments delivered modest year over year growth, reflecting steady demand and the ongoing contribution of these products to the overall portfolio.
Multiomics revenue for the quarter was 67 million up. 1% on a reported basis and flat organically. Next Generation, sequencing continues to benefit from strong customer demand.
Turning to gross margin for sample management solutions, we delivered 45, 4% for the quarter down 370 basis points versus the prior year the decline.
Genesis is this growth was supported by strong oligo demand in China?
Lawrence Lin: The decline was primarily driven by higher rework costs incurred on automated stores projects and the negative impact of a non-recurring item. The incremental automated stores cost stems from quality issues that we have been addressing through targeted efforts with our customers. We expect our remediation efforts to be completed by the end of Q2 and to incur a full year estimated impact between $3 million to $5 million. Turning next to the Multiomics segment. Multiomics revenue for the quarter was $67 million, up 1% on a reported basis and flat organically. Next-generation sequencing continues to benefit from strong customer demand. Gene synthesis growth was supported by strong oligo demand in China. These gains were offset by continued weakness in Sanger sequencing, which declined meaningfully compared to last year.
Lawrence Lin: The decline was primarily driven by higher rework costs incurred on automated stores projects and the negative impact of a non-recurring item. The incremental automated stores cost stems from quality issues that we have been addressing through targeted efforts with our customers. We expect our remediation efforts to be completed by the end of Q2 and to incur a full year estimated impact between $3 million to $5 million. Turning next to the Multiomics segment. Multiomics revenue for the quarter was $67 million, up 1% on a reported basis and flat organically. Next-generation sequencing continues to benefit from strong customer demand. Gene synthesis growth was supported by strong oligo demand in China. These gains were offset by continued weakness in Sanger sequencing, which declined meaningfully compared to last year.
These gains were offset by continued weakness and Sanger sequencing which declined meaningfully compared to last year.
It was primarily driven by higher rework costs incurred on automated stores projects and the negative impact of a non reoccurring items.
The incremental automated stores costs stems from quality issues that we have been addressing through targeted efforts with our customers.
Geographically Europe and Asia performed strongly supported by our commercial initiatives and improved execution. With China continuing to perform well with 26% organic growth.
We expect our remediation efforts to be completed by the end of the second quarter and to incur a full year estimate impact between 3 million to $5 million.
North America was soft to reflecting macro driven budget, constraints and the temporary disruption from the government shutdown, which impacted customer activity during the quarter.
Turning next to the multi Omics segment mulch.
<unk> revenue for the quarter was $67 million up 1% on a reported basis and flat organically next generation sequencing continues to benefit from strong customer demand.
Multiomics non-gaap girls, margin was 42.6% down. 350 basis, points. Year-over-year driven by Regional mix and loss. Leverage from lower, North America sales volume.
Next, let's turn to slide 6 for a review of the balance sheet.
Gene synthesis growth was supported by strong all ago demand in China.
As I mentioned, we ended the quarter with 571 million in cash cash equivalents and marketable securities.
These gains were offset by continued weakness in sanger sequencing, which declined meaningfully compared to last year.
We had no debt outstanding.
Lawrence Lin: Geographically, Europe and Asia performed strongly, supported by our commercial initiatives and improved execution, with China continuing to perform well with 26% organic growth. North America was softer, reflecting macro-driven budget constraints and the temporary disruption from the government shutdown, which impacted customer activity during the quarter. Multiomics Non-GAAP gross margin was 42.6%, down 350 basis points year-over-year, driven by regional mix and loss leverage from lower North America sales volume. Next, let's turn to slide 6 for a review of the balance sheet. As I mentioned, we ended the quarter with $571 million in cash, cash equivalents, and marketable securities. We had no debt outstanding. Capital expenditures for the quarter were approximately $6 million, reflecting continued investment in automation, capacity expansion, and technology to support scalable growth.
Lawrence Lin: Geographically, Europe and Asia performed strongly, supported by our commercial initiatives and improved execution, with China continuing to perform well with 26% organic growth. North America was softer, reflecting macro-driven budget constraints and the temporary disruption from the government shutdown, which impacted customer activity during the quarter. Multiomics Non-GAAP gross margin was 42.6%, down 350 basis points year-over-year, driven by regional mix and loss leverage from lower North America sales volume. Next, let's turn to slide 6 for a review of the balance sheet. As I mentioned, we ended the quarter with $571 million in cash, cash equivalents, and marketable securities. We had no debt outstanding. Capital expenditures for the quarter were approximately $6 million, reflecting continued investment in automation, capacity expansion, and technology to support scalable growth.
Geographically Europe and Asia performed strongly supported by our commercial initiatives and improved execution with China, continuing to perform well with 26% organic growth.
Capital expenditures for the quarter were approximately 6 million, reflecting continued investment in automation capacity expansion and Technology to support scalable growth.
North America was softer, reflecting macro driven budget constraints and the temporary disruption from the government shutdown, which impacted customer activity during the quarter multi.
Turning to guidance on slide 8. We referring our guidance for fiscal 2026 with Organic Revenue growth. Expected in the range of 3% to 5%
<unk> non-GAAP gross margin was 42, 6% down 350 basis points year over year, driven by regional mix and loss leverage from lower North America sales volume.
multiomics is projected to deliver low single-digit growth. While sample management solution is anticipated to contribute, mid single digit growth. We continue to expect the second half of the year to accelerate as our commercial Investments and growth initiatives. Gain traction
Next let's turn to slide six for a review of the balance sheet.
As I mentioned, we ended the quarter with $571 million in cash cash equivalents and marketable securities.
We had no debt outstanding.
Capital expenditures for the quarter were approximately $6 million, reflecting continued investment in automation and capacity expansion and technology to support scalable growth.
On the profitability front, we are also reaffirming our Target of approximately 300 basis points of year-over-year, adjusted ibida margin expansion driven by continued operational efficiencies disciplined cost management and scalable operating leverage as well as over 30% year-over-year Improvement in free, cash flow generation.
Progression and committed to the full year outlook.
Lawrence Lin: Turning to guidance on Slide 8, we are reaffirming our guidance for fiscal 2026, with organic revenue growth expected in the range of 3% to 5%. Multiomics is projected to deliver low single-digit growth, while Sample Management Solution is anticipated to contribute mid-single-digit growth. We continue to expect the second half of the year to accelerate as our commercial investments and growth initiatives gain traction. On the profitability front, we are also reaffirming our target of approximately 300 basis points of year-over-year adjusted EBITDA margin expansion, driven by continued operational efficiencies, disciplined cost management, and scalable operating leverage, as well as over 30% year-over-year improvement in free cash flow generation. Overall, we remain optimistic about the year's progression and committed to the full-year outlook. In closing, we remain encouraged by the progress of our growth initiatives and operational improvements.
Lawrence Lin: Turning to guidance on Slide 8, we are reaffirming our guidance for fiscal 2026, with organic revenue growth expected in the range of 3% to 5%. Multiomics is projected to deliver low single-digit growth, while Sample Management Solution is anticipated to contribute mid-single-digit growth. We continue to expect the second half of the year to accelerate as our commercial investments and growth initiatives gain traction. On the profitability front, we are also reaffirming our target of approximately 300 basis points of year-over-year adjusted EBITDA margin expansion, driven by continued operational efficiencies, disciplined cost management, and scalable operating leverage, as well as over 30% year-over-year improvement in free cash flow generation. Overall, we remain optimistic about the year's progression and committed to the full-year outlook. In closing, we remain encouraged by the progress of our growth initiatives and operational improvements.
Turning to guidance on slide eight.
We are reaffirming our guidance for fiscal 2026 with organic revenue growth expected in the range of 3% to 5% multi.
In closing, we remain encouraged by the progress of our growth initiatives and operational improvements.
<unk> is projected to deliver low single digit growth while sample management solution is anticipated to contribute mid single digit growth. We continue to expect the second half of the year to accelerate as our commercial investments and growth initiatives gain traction.
As we move through fiscal 2026, we remain confident that the Strategic priorities outlined at investor day. Provide a clear road map to drive sustainable profitable growth and long-term value creation for our shareholders.
This concludes our prepared remarks and I will now turn the call over to the operator for questions.
On the profitability front, we are also reaffirming our target of approximately 300 basis points of year over year. Adjusted EBITDA margin expansion driven by continued operational efficiencies disciplined cost management and scalable operating leverage as well as over 30% year over year improvement in free cash flow generation.
Thank you, sir. Ladies and gentlemen, if you do have any questions at this time, please press star. Followed by 1 on your touchtone phone. You will then hear a prompt that your hand has been raped. And she, you wish to decline from Napoleon process, please, press star followed by 2. If you're using a speaker phone, you will need to lift the handset. First, before pressing any keys,
Overall, we remain optimistic about the year's progression and commit to the full year outlook.
In closing we remain encouraged by the progress of our growth initiatives and operational improvements as we move through fiscal 2026, we remain confident that the strategic priorities outlined at Investor day provide a clear roadmap to drive sustainable profitable growth and long term value creation for our shareholders.
And out of consideration to other callers and time allotted today. We ask that you please limit yourself to 1 question and 1 follow-up.
Thank you.
Lawrence Lin: As we move through fiscal 2026, we remain confident that the strategic priorities outlined at Investor Day provide a clear roadmap to drive sustainable, profitable growth and long-term value creation for our shareholders. This concludes our prepared remarks, and I will now turn the call over to the operator for questions.
Lawrence Lin: As we move through fiscal 2026, we remain confident that the strategic priorities outlined at Investor Day provide a clear roadmap to drive sustainable, profitable growth and long-term value creation for our shareholders. This concludes our prepared remarks, and I will now turn the call over to the operator for questions.
And your first question will be from David Saxon at Needham please. Go ahead. David.
This concludes our prepared remarks, and I will now turn the call over to the operator for questions.
Operator: Thank you, sir. Ladies and gentlemen, if you do have any questions at this time, please press star followed by one on your touchtone phone. You will then hear a prompt that your hand has been raised, and should you wish to decline from the polling process, please press star followed by two. If you're using a speakerphone, you will need to lift the handset first before pressing any keys. And out of consideration to other callers and time allotted today, we ask that you please limit yourself to one question and one follow-up. Thank you. And your first question will be from David Saxon at Needham. Please go ahead, David.
Operator: Thank you, sir. Ladies and gentlemen, if you do have any questions at this time, please press star followed by one on your touchtone phone. You will then hear a prompt that your hand has been raised, and should you wish to decline from the polling process, please press star followed by two. If you're using a speakerphone, you will need to lift the handset first before pressing any keys. And out of consideration to other callers and time allotted today, we ask that you please limit yourself to one question and one follow-up. Thank you. And your first question will be from David Saxon at Needham. Please go ahead, David.
Thank you, Sir ladies and gentlemen, if you do have any questions. At this time. Please press star followed by one on your Touchtone phone.
Great. Uh, good morning, John and Lawrence. Thanks for taking my questions. So I I wanted to start on the gross margin. Um, so maybe can you talk about just your level of confidence and and getting the SMS margins back to where you want them to be, you know, what's in your control versus, um, you know, impacted by maybe customer Dynamics and then just on the growth uh sorry ebit, Dom margin, you reiterated the 300 basis point.
I'm here, a prompt that Johan has been raised and should you wish to decline from the polling process. Please press star followed by.
Of of margin expansion here.
If you're using a speakerphone you will need to lift the handset before.
Before pressing any keys and.
And out of consideration to other columns and time allotted today.
Ask that you please limit yourself to one question and one follow up thank you.
I guess what's your level of confidence that the, the GM om mix is going to be, uh, 200 and, and 100 basis points Opex, looks like, um, you know, it was below what we were modeling so does Opex drive more of the 300 basis points this year.
And your first question will be from David Saxon at Needham. Please go ahead David.
David Saxon: Great. Good morning, John and Lawrence. Thanks for taking my questions. So I, I wanted to start on the gross margin. So maybe can you talk about just your level of confidence in, in getting the SMS margins back to where you want them to be? You know, what's in your control versus, you know, impacted by maybe customer dynamics? And then just on the growth, sorry, EBITDA margin, you reiterated the 300 basis points of, of margin expansion here. I guess, what's your level of confidence that the, the GM OM mix is gonna be, 200 and 100 basis points? OpEx looks like, you know, it was below what we were modeling. So does OpEx drive more of the 300 basis points this year?
David Saxon: Great. Good morning, John and Lawrence. Thanks for taking my questions. So I, I wanted to start on the gross margin. So maybe can you talk about just your level of confidence in, in getting the SMS margins back to where you want them to be? You know, what's in your control versus, you know, impacted by maybe customer dynamics? And then just on the growth, sorry, EBITDA margin, you reiterated the 300 basis points of, of margin expansion here. I guess, what's your level of confidence that the, the GM OM mix is gonna be, 200 and 100 basis points? OpEx looks like, you know, it was below what we were modeling. So does OpEx drive more of the 300 basis points this year?
Great Good morning, John and Laurence Thanks for taking my questions.
I wanted to start on the gross margin. So maybe can you talk about just your level of confidence in getting the SMS margins back to where you want them to be whats in your control versus.
Yeah, David good morning. Good to be with you. Thanks for the question. So let me just pull us back for a second around. Um, you know what what's happened since our investor day?
Impacted by maybe customer dynamics, and then just on the sorry, EBITDA margin you reiterated the 300 basis points of margin expansion here.
I guess, what's your level of confidence that the.
The GM AUM mix is going to be.
201 hundred basis points Opex look like.
It was below what we were modeling so does opex drive more of the 300 basis points. This year.
John Marotta: ... Yeah, David, good morning. Good to be with you. Thanks for the question. So let me just pull us back for a second around, you know, what, what's happened since our investor day and just kinda talk through that. This will kind of lead into some of the answers to your question. So Azenta-specific developments, I would think about a few things. This product mix and geo mix causing some of those margin headwinds. Overall, I think the portfolio met expectations. Product performance, not this is not a known issue. This is not a new issue for us in terms of the quality of stores. We can get into the details of that. We had 18 stores that we had some quality issues. We're starting to lap some of those.
John Marotta: ... Yeah, David, good morning. Good to be with you. Thanks for the question. So let me just pull us back for a second around, you know, what, what's happened since our investor day and just kinda talk through that. This will kind of lead into some of the answers to your question. So Azenta-specific developments, I would think about a few things. This product mix and geo mix causing some of those margin headwinds. Overall, I think the portfolio met expectations. Product performance, not this is not a known issue. This is not a new issue for us in terms of the quality of stores. We can get into the details of that. We had 18 stores that we had some quality issues. We're starting to lap some of those.
Yes, David Good morning, good to be with you. Thanks for the questions Felipe just pulls back for a second around.
What's happened since our Investor day, and just kind of talk through that this will kind of.
And and just kind of talk through that this will uh kind of lead into some of the answers to your question. So zenta specific developments. I would I would think about a few things this product mix and geomix causing some of those margin headwinds, uh, overall, I think the performance, the the portfolio met expectations product performance, not just not a known issue. Uh, I'm this is not a new issue for us in terms of the quality of of Stores, um, we can get into the details of that. We had 18 stores uh, that we had some quality issues. We're starting to elapse some of those. We've got only a few more that we've got to continue to, to go and solve for. Um, a lot of the, a lot of this has been more noticeable this year, um, due to the due, to what we've been with flagging, uh, with, with the investor Community around.
Lead into some of the answers to your question. So is that the specific developments I would I would think about a few things this product mix geo mix, causing some of those margin headwinds our overall I think the performance.
Office on the first half. So the less of those Tailwinds uh uh there
The portfolio met expectations product performance not does not a known issue.
And then lastly uh aenta specific developments is kind of this uh North America reboot commercially both in multiomics and SMS.
This is not a new issue for us in terms of the quality of stores.
We can get into the details of that we had 18 stores that we had some quality issues were starting to lap some of those we've got only a few more that we've got to continue to go and solve for.
John Marotta: We've got only a few more that we've got to continue to go and solve for. A lot of this has been more noticeable this year, due to what we've been flagging with the investor community around softness on the first half, so less of those tailwinds there. And then lastly, Azenta-specific developments is kind of this North America reboot commercially, both in Multiomics and SMS. We're way ahead on our reboot in Europe, in the Middle East, in parts of APAC; North America lags in certain areas. That's really kind of an update there. End market-wise, listen, slower than expected in North America. Government shutdown impact, that's pretty well understood right now.
John Marotta: We've got only a few more that we've got to continue to go and solve for. A lot of this has been more noticeable this year, due to what we've been flagging with the investor community around softness on the first half, so less of those tailwinds there. And then lastly, Azenta-specific developments is kind of this North America reboot commercially, both in Multiomics and SMS. We're way ahead on our reboot in Europe, in the Middle East, in parts of APAC; North America lags in certain areas. That's really kind of an update there. End market-wise, listen, slower than expected in North America. Government shutdown impact, that's pretty well understood right now.
We have been, uh, we're way ahead on our reboot in Europe in the Middle East and in parts of APAC, North America lags in certain areas, that's really kind of a, a, a, an update there. And Market wise, uh, listen, slower than expected, uh, in North America, the government shutdown impact that was
A lot of the.
A lot of this has been more noticeable this year.
Due to the due to what we have been flagging.
pretty uh it's pretty well understood right now uh Sanger continues to slide from an End Market perspective, and you've got some geopolitical instability
With with the Investor community around softness on the first half so less of those tailwind.
Are there.
And then lastly.
Is there a specific developments as kind of this north America reboot commercially both in multi omics and SMS.
Ben.
We're way ahead on our reboot in Europe, and the Middle East and parts of APAC North America lags in certain areas, that's really kind of.
And update their end market wise.
Listen slower than expected.
I think in terms of uh, our confidence, we're continuing uh, to reiterate our our guidance, for the full year. What I can tell you is, yes, our job just got harder on the margin line, but that's our job. We're pulling some hard levers here. Uh we're going to continue to do that. We've been very clear that we're not managing this business on the quarter. Um we're not going to do that with the within the 3 years of our turnaround that we've signaled uh very strongly at our investor day. So um we're confident and I'll let Lawrence get into those particulars of that David, but thanks.
In North America government shutdown impact that was.
For the question.
It's pretty well understood right now.
John Marotta: Sanger continues to slide from an end market perspective, and you've got some geopolitical instability. I think in terms of our confidence, we're continuing to reiterate our guidance for the full year. What I can tell you is, yes, our job just got harder on the margin line, but that's our job. We're pulling some hard levers here, we're gonna continue to do that. We've been very clear that we're not managing this business on the quarter. We're not going to do that within the three years of our turnaround that we've signaled very strongly at our investor day. So, we're confident, and I'll let Lawrence get into those particulars of that, David, but thanks for the question.
John Marotta: Sanger continues to slide from an end market perspective, and you've got some geopolitical instability. I think in terms of our confidence, we're continuing to reiterate our guidance for the full year. What I can tell you is, yes, our job just got harder on the margin line, but that's our job. We're pulling some hard levers here, we're gonna continue to do that. We've been very clear that we're not managing this business on the quarter. We're not going to do that within the three years of our turnaround that we've signaled very strongly at our investor day. So, we're confident, and I'll let Lawrence get into those particulars of that, David, but thanks for the question.
Sanger continues to slide from an end market perspective, and you've got some geopolitical instability.
I think in terms of.
Our confidence.
We're continuing.
To reiterate our guidance for the full year, what I can tell you is yes, our job just got harder on the margin line, but that's our job proposed some hard levers here, we're going to continue to do that we've been very clear that we're not managing this business on the quarter.
2 million related stores, qualities used that John talked about Roy, we anticipate these quality issues to be fixed by the end of Q2.
secondly, there's
We're not going to do that within the three years of our turnaround that we've signaled.
Very strongly at our Investor day so.
about a million dollars related to some of the lab inefficiencies that we saw particularly in North America.
We are confident and I'll, let lawrence get into those particulars of that David but thanks for the question.
Lawrence Lin: Yeah, David, this is Lawrence. Maybe let's just talk a little bit about Q1 and give you a bit of a breakdown. So as you know, Adjusted EBITDA was 12.7 in the first quarter, or about 8.5%, which was down $3.3 million versus prior year. So broadly, the decline of the components of the decline were $2 million related to the stores quality issues that John talked about. Really, we anticipate these quality issues to be fixed by the end of Q2. Secondly, there's about $1 million related to some of the lab inefficiencies that we saw, particularly in North America. As you saw, from a top-line perspective, we met kind of what we expected, but certainly the mix was leaning towards Asia than North America.
Lawrence Lin: Yeah, David, this is Lawrence. Maybe let's just talk a little bit about Q1 and give you a bit of a breakdown. So as you know, Adjusted EBITDA was 12.7 in the first quarter, or about 8.5%, which was down $3.3 million versus prior year. So broadly, the decline of the components of the decline were $2 million related to the stores quality issues that John talked about. Really, we anticipate these quality issues to be fixed by the end of Q2. Secondly, there's about $1 million related to some of the lab inefficiencies that we saw, particularly in North America. As you saw, from a top-line perspective, we met kind of what we expected, but certainly the mix was leaning towards Asia than North America.
Yes, David This is Laurent maybe let's just talk a little bit about Q1, and give you a bit of a breakdown. So as you know adjusted EBIT was $12 seven in the first quarter or about eight 5%, which was down $3 3 million.
As you saw from a Topline perspective, we met kind of what we expected. But certainly the mix was, uh, leaning towards, uh, Asia than North America. So certainly that impacted some of our lab inefficient, or lab efficiency in in the region.
Versus prior year, so broadly that decline.
and then lastly, there was a about 700,000 in non-recurring charges related to
Inventory adjustments.
The components of the decline were $2 million related to storage quality issues that John talked about right. We anticipate these quality issues to be fixed by the end of Q2.
So when you look at that, that those are kind of the broad Strokes of the q1 decline.
1.
Secondly, there is.
$1 million related to some of the lat inefficiencies that we saw particularly in North America.
As you saw from a topline perspective, we met kind of what we expected, but certainly the mix was leaning.
Leaning towards.
You know what, what I say is is particularly around your question on the mix on the uh, uh, overall profitability and the model, we still hold firm that growth profit, would be around this 200 basis points in the GP side, and no 100 basis points. And when you, when you think about that, that's going to generally stem from
Asia than North America, or certainly that impacted some of our lab inefficient or lab efficiency.
Lawrence Lin: So certainly, that impacted some of our lab inefficiency in the region. And then lastly, there was about $700,000 in non-recurring charges related to inventory adjustments. So when you look at that, those are kind of the broad strokes of the Q1 decline. You know, what I'd say is particularly around your question on the mix, on the overall profitability in the model, we still hold firm that gross profit would be around 200 basis points in the GP side and 100 basis points. And when you think about that, that's going to generally stem from half related to sales volume. As we talked about on Investor Day, there's a second half ramp.
Lawrence Lin: So certainly, that impacted some of our lab inefficiency in the region. And then lastly, there was about $700,000 in non-recurring charges related to inventory adjustments. So when you look at that, those are kind of the broad strokes of the Q1 decline. You know, what I'd say is particularly around your question on the mix, on the overall profitability in the model, we still hold firm that gross profit would be around 200 basis points in the GP side and 100 basis points. And when you think about that, that's going to generally stem from half related to sales volume. As we talked about on Investor Day, there's a second half ramp.
In the region.
And then lastly, there was about 700000 in non reoccurring charges related to <unk>.
Inventory adjustments.
Related to sales volume as we talked about an investor day. There's a second half ramp we. We've always, uh, tried to Telegraph that. You know, we are fully aware that the first half would be softer than, uh, kind of our traditional, uh, uh, uh, phasing.
So when you look at that that those are kind of the broad strokes of the Q1 decline.
One.
Just because we, we are kind of putting all this growth, uh, uh, uh uh uh you know investments in place.
What I'd say is particularly around your question on the mix on the.
So again, we're still holding to the 200 on gross profit and 100 because of uh volume.
Overall profitability in the model, we still hold firm that gross profit would be around this 200 basis points in the GP side, and 100 basis points and when you. When you think about that that's going to generally stem from.
Abs.
Lean productivity, really kind of taking hold.
And then price.
Half related to sales volume as we talked about in Investor day, there is a.
Second half ramp we've always.
Lawrence Lin: We've always tried to telegraph that, you know, we're fully aware that the first half would be softer than kind of our traditional phasing. Just because we are kind of putting all this growth, you know, investments in place. So again, we're still holding to the $200 on gross profit, $100, because of volume, ABS, lean productivity, really kind of taking hold, and then price.
Lawrence Lin: We've always tried to telegraph that, you know, we're fully aware that the first half would be softer than kind of our traditional phasing. Just because we are kind of putting all this growth, you know, investments in place. So again, we're still holding to the $200 on gross profit, $100, because of volume, ABS, lean productivity, really kind of taking hold, and then price.
Tried to telegraph that.
We are fully aware that the first half would be softer than.
We have our traditional.
Phasing.
Just because we're kind of putting all of this growth.
Okay, uh, that was super hope hopeful. So thanks uh, to both of you. And then my follow-up was just on Capital spending in in that academic and government, uh, group. I guess, can you characterize the conversations you've had with customers in those segments during the quarter and just level of confidence that, you know, that will improve and and you know how that will drive North America, uh, demand and and and growth, thanks so much.
Investments in place. So again, we're still holding to the 200 on gross profit 100 because of volume.
ABS lean productivity really kind of taking hold.
From a European perspective. Um, really, really a lot of momentum in, in Europe, in the Middle East in that sector.
And then price.
John Marotta: Okay. That was super helpful, so thanks to both of you. And then my follow-up was just on capital spending in that academic and government group. I guess, can you characterize the conversations you've had with customers in those segments during the quarter? And just level of confidence that, you know, that will improve and, you know, how that will drive North America demand and growth. Thanks so much.
David Saxon: Okay. That was super helpful, so thanks to both of you. And then my follow-up was just on capital spending in that academic and government group. I guess, can you characterize the conversations you've had with customers in those segments during the quarter? And just level of confidence that, you know, that will improve and, you know, how that will drive North America demand and growth. Thanks so much.
Okay that was super helpful. So thanks to both of you and then my follow up was just on capital spending in that academic and government group.
Group I guess can you characterize the conversations you've had with customers in those segments during the quarter.
In the US I will tell you there's a lot of green shoots I mean I think the back half we still feel bullish on that and the conversations we're having with our academic and government customers are are confirmatory at this point. So good momentum there in North America specifically
And just level of confidence that.
That will improve and how that will drive North America demand and growth. Thanks, so much.
Next question will be from Matt Stanton at Jeffrey's. Please go ahead. Matt.
Lawrence Lin: Sure, David. Yeah, listen, great conversations with those, that end market in terms of customers. I think so from a European perspective, really, really a lot of momentum in Europe and the Middle East in that sector.
Lawrence Lin: Sure, David. Yeah, listen, great conversations with those, that end market in terms of customers. I think so from a European perspective, really, really a lot of momentum in Europe and the Middle East in that sector.
Sure David.
Listen great conversations with those.
That end market in terms of customers I think we so.
From a European perspective.
Really really a lot of momentum in Europe, and the middle east in that sector in.
John Marotta: ... In the US, I will tell you there's a lot of green shoots. I mean, I think the back half, we still feel bullish on that, and the conversations we're having with our academic and government customers are confirmatory at this point. So good momentum there in North America, specifically.
John Marotta: ... In the US, I will tell you there's a lot of green shoots. I mean, I think the back half, we still feel bullish on that, and the conversations we're having with our academic and government customers are confirmatory at this point. So good momentum there in North America, specifically.
In the U S. I will tell you theres a lot of green shoots I mean, I think the back half, we still feel bullish on that and the conversations we're having with our academic and government customers.
Hey thanks. Uh, maybe just to go back to the the second half ramp you guys talked about. I think you talked about for the acceleration in the back half, you know, Improvement in the approval process Capital spending ramp and then growth Investments. Could you just talk about level of comfort or visibility into some of those key drivers? And then on the gross margin side, I think you said 3 to 5 million was tied to to some of these quality issues that are largely be done in the end of 22. So that implied, the absence of that headwind in the back, half is kind of a 100 basis point plus step up alone to to gross margins. Just want to make sure I have that that uh clear thanks.
Our our confirmatory at this point so good momentum there in North America specifically.
Operator: Thank you. Next question will be from Matt Stanton at Jefferies. Please go ahead, Matt.
Operator: Thank you. Next question will be from Matt Stanton at Jefferies. Please go ahead, Matt.
Sure, let me just give you some context around Capital spending again. We're we're feeling pretty confident that uh, that North America
Yes.
Next question will be from Matt Stanton of Jefferies. Please go ahead ma'am.
Matthew Stanton: Hey, thanks. Maybe just to go back to the second half ramp you guys talked about. I think you talked about for the acceleration in the back half, you know, improvement in the approval process, capital spending ramp, and then growth investments. Could you just talk about level of comfort or visibility into some of those key drivers? And then on the gross margin side, I think you said $3 to 5 million was tied to some of these quality issues that will largely be done in the end of Q2. So that implied the absence of that headwind in the back half is kind of a 100 basis point plus step up alone to gross margins. Just wanna make sure I have that clear. Thanks.
Matthew Stanton: Hey, thanks. Maybe just to go back to the second half ramp you guys talked about. I think you talked about for the acceleration in the back half, you know, improvement in the approval process, capital spending ramp, and then growth investments. Could you just talk about level of comfort or visibility into some of those key drivers? And then on the gross margin side, I think you said $3 to 5 million was tied to some of these quality issues that will largely be done in the end of Q2. So that implied the absence of that headwind in the back half is kind of a 100 basis point plus step up alone to gross margins. Just wanna make sure I have that clear. Thanks.
Hey, Thanks, maybe just to go back to the second half ramp you guys talked about I think you've talked about for the acceleration in the back half improvement in the approval process capital spending ramp and then.
Is coming back. We do think this is the back half story. Um, you know, when we talk to our customers and and more importantly, our sales team, we are, we are, uh, driving a lot of conversations with our sales team at
Growth investments do you just talk about level of comfort or visibility into some of those key drivers and then on the gross margin side. I think you said $3 million to $5 million was tied to some of these quality issues that will largely be done the end of <unk>. So <unk>.
A high frequency, they're feeling pretty bullish right now and a lot of the programs we're working on specifically in cni, instruments and Stores. Um,
Implied the absence of that headwind in the back half is kind of a 100 basis point plus step up alone two to gross margins just want to make sure I have that.
and um,
Clear thanks.
John Marotta: Sure. Let me just give you some context around capital spending. Again, we're, we're feeling pretty confident that that North America is coming back. We do think this is a back half story. You know, when we talk to our customers and, and more importantly, our sales team, we are, we are driving a lot of conversations with our sales team at a, at a high frequency. They're feeling pretty bullish right now. And a lot of the programs we're working on, specifically in C&I instruments and stores, we continue to, to gain some momentum there. In terms of growth investments, as you know, our growth investments are specifically in feet on the street, innovation, some productivity gains, and, and just driving performance in those areas. We continue to ring-fence those investments. We are not coming off of those.
John Marotta: Sure. Let me just give you some context around capital spending. Again, we're, we're feeling pretty confident that that North America is coming back. We do think this is a back half story. You know, when we talk to our customers and, and more importantly, our sales team, we are, we are driving a lot of conversations with our sales team at a, at a high frequency. They're feeling pretty bullish right now. And a lot of the programs we're working on, specifically in C&I instruments and stores, we continue to, to gain some momentum there. In terms of growth investments, as you know, our growth investments are specifically in feet on the street, innovation, some productivity gains, and, and just driving performance in those areas. We continue to ring-fence those investments. We are not coming off of those.
Sure. Let me just give you some context around capital spending again, we're feeling pretty confident that that North America.
And just driving performance. In those areas, we continue to ring fence those Investments. We are not coming off of those, we think that, um,
Is coming back we do think there is the back half story.
When we talk to our customers and more importantly, our sales team. We are we are driving a lot of conversations with our sales team.
At a high frequency theyre, feeling pretty bullish right now and a lot of the programs. We're working on specifically in C&I instruments in stores.
We continue to gain some momentum there in terms of growth investments as you know our growth investments are specifically in feet on the street.
That as a part of our you know the transformation in the next few years. Getting these growth Investments now is going to be pretty meaningful specifically in R&D and Innovation. I'm, I'm pleased with where the teams are in terms of where these Investments have been made are higher in around that and more importantly driving to, uh, the the road maps that the teams have on the product side. So, please around that. Um,
Let Lawrence talk about the the second half ramp and give you some of the specifics there.
<unk> innovation, some productivity gains and.
And just driving performance in those areas, we continue to ring fence those investments, we're not coming off of those we think that.
Yeah, uh hey Matt, so when we look at overall Eva for the year and the 300, the the road to the 300 basis points, it's 22 million incremental year-on-year.
and,
John Marotta: We think that as a part of our, you know, the transformation in the next few years, that getting these growth investments now is gonna be pretty meaningful, specifically in R&D and innovation. I'm pleased with where the teams are in terms of where these investments have been made, are hiring around that, and more importantly, driving to the roadmaps that the teams have on the product side. So pleased around that. Let Lawrence talk about the second half ramp and give you some of the specifics there.
John Marotta: We think that as a part of our, you know, the transformation in the next few years, that getting these growth investments now is gonna be pretty meaningful, specifically in R&D and innovation. I'm pleased with where the teams are in terms of where these investments have been made, are hiring around that, and more importantly, driving to the roadmaps that the teams have on the product side. So pleased around that. Let Lawrence talk about the second half ramp and give you some of the specifics there.
Yet as a part of our debt.
The transformation in the next few years that getting these growth investments now is going to be pretty meaningful specifically in R&D and innovation I'm pleased with where the teams are in terms of where these investments have been made are hiring around that and more importantly, driving too.
Particularly, you know, we talked to a bit about what Dave about this had 200 basis points, 100 basis points, uh, 200 basis points and growth margin 100 basis points on Opex.
The roadmaps that the teams have on the product side, so pleased around that.
Let Lawrence talk about the second half ramp and give you some of the specifics there.
When you look at the growth margin, mix, it's driven by the sales volume, half of its going to be sales volume, what John just talked about, right, as our sales reps. Particularly North America starts to ramp, uh, in the second half of the Year. Usually our, you know, we, we brought in north of 25 reps, uh, and usually, they take about 3 to 6 months to ramp. So that's kind of in our calculus.
Lawrence Lin: Yeah. Hi, Matt. So when we look at overall EBITDA for the year and the road to the 300 basis points, it's $22 million incremental year on year. And particularly, you know, we talked a bit about, with Dave, about this kind of 200 basis points, 100 basis points, 200 basis points in gross margin, 100 basis points in OpEx. When you look at the gross margin mix, it's driven by the sales volume. Half of it's gonna be sales volume, what John just talked about, right? As our sales reps, particularly in North America, starts to ramp, in the second half of the year, usually our... You know, we've brought in north of 25 reps, and usually they take about three to six months to ramp, so that's kind of in our calculus.
Lawrence Lin: Yeah. Hi, Matt. So when we look at overall EBITDA for the year and the road to the 300 basis points, it's $22 million incremental year on year. And particularly, you know, we talked a bit about, with Dave, about this kind of 200 basis points, 100 basis points, 200 basis points in gross margin, 100 basis points in OpEx. When you look at the gross margin mix, it's driven by the sales volume. Half of it's gonna be sales volume, what John just talked about, right? As our sales reps, particularly in North America, starts to ramp, in the second half of the year, usually our... You know, we've brought in north of 25 reps, and usually they take about three to six months to ramp, so that's kind of in our calculus.
Hi, Matt so.
uh, the other component in there is around
When we look at overall EBITDA for the year and the 300 the road to the 300 basis points, that's $22 million incremental year on year.
abs and productivity, some of these topics we covered in investor day, right? You know, we are having
And.
Particularly with <unk>.
Talk a bit about Dave about this type 200 basis points 100 basis points 200 basis points in gross margin 100 basis points on Opex.
You look at the gross margin mix, it's driven by the second half of it's going to be sales volume, what John just talked about right as our sales reps, particularly in North America starts to ramp.
Kaizen events in our lap uh, Labs as well as our shop floors in manufacturing, and that's about 35% of the overall GM Improvement. So volume 50.
In the second half of the year, usually we brought in north of 25 reps.
And usually they take about three to six months to ramp so thats kind of in our calculus.
ABS is about 35. And then certainly we talked a bit about last earnings call is about our price initiatives, that makes up the rest of the gross margin Improvement and that price Improvement is particularly focused around SRS and our cni businesses.
Lawrence Lin: The other component in there is around ABS and productivity. Some of these topics we covered in Investor Day, right? You know, we are having Kaizen events in our labs as well as our shop floors and manufacturing, and that's about 35% of the overall GM improvement. So volume 50, ABS is about 35. And then certainly, we talked a bit about last earnings call, is about our price initiatives. That makes up the rest of this gross margin improvement. And that price improvement is particularly focused around SRS and our C&I businesses. We've put those in place really at the start of the calendar year, and that really starts to ramp in the second half of the year.
Lawrence Lin: The other component in there is around ABS and productivity. Some of these topics we covered in Investor Day, right? You know, we are having Kaizen events in our labs as well as our shop floors and manufacturing, and that's about 35% of the overall GM improvement. So volume 50, ABS is about 35. And then certainly, we talked a bit about last earnings call, is about our price initiatives. That makes up the rest of this gross margin improvement. And that price improvement is particularly focused around SRS and our C&I businesses. We've put those in place really at the start of the calendar year, and that really starts to ramp in the second half of the year.
The other component in there is around.
We've we've put those in place really at the start of the calendar year and that really starts a ramp in the second half of the year.
<unk> productivity some of these <unk>.
Topics, we covered at Investor day, right we are.
This question will be from Mackie talk at Stevens. Please go ahead Mack.
Are having.
Kaizen events in our lap.
<unk> as well as our shop floors, and manufacturing and that's about 35% of the overall GM improvement so volumes 50.
ABS is about 35, and then certainly we talked a bit about last earnings call is about our price initiatives that makes up the rest of the gross margin improvement and that price improvement is particularly focused around srs and our C&I businesses.
Hello. Good morning, I appreciate you taking my question. Maybe just to follow up. I appreciate the, uh, the color on the back half ramp. But just given the performance in 1 Q. Can you, give us a sense of your expectations for Topline performance in 2q? And then, you know, maybe your expectations around the Cadence from 22 to 3 Q.
We've we've put those in place really at the start of the calendar year and that really starts to ramp in the second half.
Yeah, uh, payback. Uh, so when we look at the sect and quarter, I, you know, certainly we've talked, we first, let me step back and say, look we're really, not guiding quarterly, but when we look at overall Revenue ramp, right,
You know, it again it's weighted in the second half of the year.
Operator: Thank you. Next question will be from Mason Carrico at Stephens. Please go ahead, Mack.
Operator: Thank you. Next question will be from Mason Carrico at Stephens. Please go ahead, Mack.
Next question will be from Matthew talk at Stevens. Please go ahead ma'am.
Mason Carrico: Hello, good morning. I appreciate you taking my question. Maybe just a follow-up. I appreciate the color on the back-half ramp, but just given the performance in Q1, can you give us a sense of your expectations for top-line performance in Q2, and then, you know, maybe your expectations around the cadence from Q2 to Q3?
Mason Carrico: Hello, good morning. I appreciate you taking my question. Maybe just a follow-up. I appreciate the color on the back-half ramp, but just given the performance in Q1, can you give us a sense of your expectations for top-line performance in Q2, and then, you know, maybe your expectations around the cadence from Q2 to Q3?
Hello, Good morning, I. Appreciate you taking my question, maybe just a follow up I appreciate it.
The color on the back half ramp, but just given the performance in <unk> can.
Uh, and those are really the components there. Uh, so you'll probably see uh, uplift in versus the first quarter. But certainly a lot of what we're going to see in terms of growth is in the second half.
Can you give us a sense of your expectations for topline performance in <unk> and <unk>.
Yeah, Mac. I mean
Maybe your expectations around the cadence from <unk>.
Lawrence Lin: Yeah, hey, Mason. So when we look at the second quarter, you know, certainly we've talked. First, let me step back and say, look, we're really not guiding quarterly, but when we look at overall revenue ramp, right, you know, again, it's weighted in the second half of the year. And those are really the components there. So you'll probably see an uplift in versus the first quarter, but certainly a lot of what we're gonna see in terms of growth is in the second half.
Lawrence Lin: Yeah, hey, Mason. So when we look at the second quarter, you know, certainly we've talked. First, let me step back and say, look, we're really not guiding quarterly, but when we look at overall revenue ramp, right, you know, again, it's weighted in the second half of the year. And those are really the components there. So you'll probably see an uplift in versus the first quarter, but certainly a lot of what we're gonna see in terms of growth is in the second half.
Yeah.
Payback, so when we look at the second quarter.
We can we can be helpful and give you some detail. But but again I I I just want to continue to reiterate this the fact that we're just not going to manage this business. Quarterly. Uh we are taking a a longer term.
Certainly we've talked.
First let me step back and say look we're really not guiding quarterly, but when we look at overall revenue ramp rate.
View on it and our growth Investments. Continue around sales, marketing and R&D.
Again, it's weighted in the second half of year.
And those are really the components there.
That's going to continue to ramp nicely. Going to drive that gross margin improvement over time. Got to get some more volume in here. Uh and then I think once North America comes online, we're going to be clicking on all cylinders. We're not right now but that's that's the journey. I mean that's part of a turnaround. Um,
So youll probably see uplift.
Versus the first quarter, but certainly a lot of what we're going to see in terms of growth is in the second half.
So, we'll be helpful there, uh, when we connect here, uh, later.
Did you have a follow-up Mack?
John Marotta: Yeah, Mack, I mean, we can be helpful and give you some detail, but again, I just wanna continue to reiterate this, the fact that we're just not gonna manage this business quarterly. We are taking a longer term view on it, and our growth investments continue around sales, marketing, and R&D. That's gonna continue to ramp nicely, gonna drive that gross margin improvement over time. Gotta get some more volume in here. And then I think once North America comes online, we're gonna be clicking on all cylinders. We're not right now, but that's the journey. I mean, that's part of a turnaround. So we'll be helpful there, when we connect here, later.
John Marotta: Yeah, Mack, I mean, we can be helpful and give you some detail, but again, I just wanna continue to reiterate this, the fact that we're just not gonna manage this business quarterly. We are taking a longer term view on it, and our growth investments continue around sales, marketing, and R&D. That's gonna continue to ramp nicely, gonna drive that gross margin improvement over time. Gotta get some more volume in here. And then I think once North America comes online, we're gonna be clicking on all cylinders. We're not right now, but that's the journey. I mean, that's part of a turnaround. So we'll be helpful there, when we connect here, later.
Yes, Mark I mean.
We can we can be helpful and do some detail, but but again I just want to continue to reiterate the fact that we're just not going to manage this business quarterly.
Uh I appreciate it. I'll leave it there for now. I appreciate you taking my questions. Thanks Mack. Sure. Thank you.
Next question, will be from Vijay Kumar at evercore. Please go ahead Vijay.
We're taking a longer term view.
A few on it and our growth investments continue around sales marketing and R&D, that's going to continue to ramp nicely to drive that gross margin improvement over time got to get some more volume in here.
And then I think what's North America comes online, we're going to be clicking on all cylinders, we're not right now.
Guys, this is Mackenzie on for Vijay, thanks for taking the questions. Um, first 1, I know you called out the government shutdown impact in the quarter but I was just wondering if you could speak to us academic a little bit more, broadly and specifically how are you thinking about performance? In this end Market, given that it seems like NIH budgets will be flat in 2026.
That's the journey I mean, that's part of a turnaround.
So it will be helpful. There when we connect here.
yeah, so uh in general I think what we're seeing is a shift in some of the uh
Later.
Operator: Did you have a follow-up, Mac?
Operator: Did you have a follow-up, Mack?
Did you have a follow up.
Mason Carrico: I appreciate. I'll leave it there for now. I appreciate you taking my questions.
Mason Carrico: I appreciate. I'll leave it there for now. I appreciate you taking my questions.
I appreciate I'll leave it there for now I appreciate you taking my questions. Thanks, Matt sure. Thank you.
John Marotta: Thanks, Mac. Sure.
John Marotta: Thanks, Mac. Sure.
Operator: Thank you. Next question will be from Vijay Kumar at Evercore. Please go ahead, Vijay.
Operator: Thank you. Next question will be from Vijay Kumar at Evercore. Please go ahead, Vijay.
Next question will be from Vijay Kumar of Evercore. Please go ahead with you Jay.
Mackenzie: Guys, this is Mackenzie on for Vijay. Thanks for taking the questions. First one, I know you called out the government shutdown impact in the quarter, but I was just wondering if you could speak to US academic a little bit more broadly. And specifically, how are you thinking about performance in this end market, given that it seems like NIH budgets will be flat in 2026?
Mackenzie Strehle: Guys, this is Mackenzie on for Vijay. Thanks for taking the questions. First one, I know you called out the government shutdown impact in the quarter, but I was just wondering if you could speak to US academic a little bit more broadly. And specifically, how are you thinking about performance in this end market, given that it seems like NIH budgets will be flat in 2026?
Yes. This is mckenzie on for Vijay Thanks for taking the questions.
First one I know you called out the government shutdown impact in the quarter, but I was just wondering if you could speak to you all thank you.
Where the dollars are moving to in terms of universities, based on uh larger projects. I mean, we're seeing a little bit of that. The, the customer base we have right now, um, with the government shutdown, we saw some of the the larger programs just so just just frankly, just standing still. And so there was no movement around that that's been freed up. And and so uh, we're now supporting some of those programs. I think in general, things are settling down.
I'll make a little bit more broadly and specifically how are you thinking about performance in this end market given that it seems like NIH budgets will be flat in 2020.
There's a clear shift in uh where that NIH funding is going right now and and we're just continuing to support those programs on balance.
John Marotta: Yeah. So, in general, I think what we're seeing is a shift in some of the, where the dollars are moving to in terms of universities based on larger projects. I mean, we're seeing a little bit of that. The customer base we have right now, with the government shutdown, we saw some of the larger programs just frankly standing still, and so there was no movement around that. That's been freed up, and so we're now supporting some of those programs. I think in general, things are settling down. There's a clear shift in where that NIH funding is going right now, and we're just continuing to support those programs. On balance, the team is really highly focused on pharma and biotech. I mean, we've always been highly focused on that.
John Marotta: Yeah. So, in general, I think what we're seeing is a shift in some of the, where the dollars are moving to in terms of universities based on larger projects. I mean, we're seeing a little bit of that. The customer base we have right now, with the government shutdown, we saw some of the larger programs just frankly standing still, and so there was no movement around that. That's been freed up, and so we're now supporting some of those programs. I think in general, things are settling down. There's a clear shift in where that NIH funding is going right now, and we're just continuing to support those programs. On balance, the team is really highly focused on pharma and biotech. I mean, we've always been highly focused on that.
Yeah. So in general I think what we're seeing is a shift in some of the.
uh, the team is really highly focused on
<unk>.
Where the dollars are moving to in terms of universities based on <unk>.
Larger projects I mean, we're seeing a little bit of that.
Uh, Pharma and biotech. I mean, we've always been highly focused on that. I, I think we continue to do that over time. Uh, we're always supporting our academic, uh, customers and and uh the universities.
Customer base, we have right now.
With the government shutdown, we saw some of the larger programs just sure just frankly, just standing still and so there was no movement around that that's been freed up.
Um, we think that there's a an opportunity specifically with the pressure on Core Labs.
So.
We're now supporting some of those programs.
I think in general things are settling down.
There is a clear shift.
And where that NIH funding is growing right now and we're just continuing to support those programs on balance.
And driving productivity On Core Labs. We think that the our multiomics business is well, positioned to continue support. Uh, the core lab is in the pressure on getting more research out, getting more data out and and uh uh so we're doing that right now. We feel pretty good about that. Uh I think that's going to continue on McKenzie but thank you for the question.
The team is really highly focused on.
Pharma and biotech I mean, we've always been highly focused on that I think we continue to do that over time, we will.
John Marotta: I think we continue to do that over time. We're always supporting our academic customers and the universities. We think that there's an opportunity, specifically with the pressure on core labs and driving productivity on core labs. We think that our Multiomics business is well positioned to continue to support the core labs and the pressure on getting more research out, getting more data out. So we're doing that right now. We feel pretty good about that. I think that's gonna continue on, Mackenzie, but thank you for the question.
John Marotta: I think we continue to do that over time. We're always supporting our academic customers and the universities. We think that there's an opportunity, specifically with the pressure on core labs and driving productivity on core labs. We think that our Multiomics business is well positioned to continue to support the core labs and the pressure on getting more research out, getting more data out. So we're doing that right now. We feel pretty good about that. I think that's gonna continue on, Mackenzie, but thank you for the question.
Always supporting our academic.
Customers in.
The universities.
We think that there is a an opportunity specifically with the pressure on core labs.
Uh, thank you, super helpful. Um, and just to follow up on that, you talked a little bit about your Pharma and biotech customers. What are you seeing from these end markets right now, is a farmer continuing to accelerate and your peers have talked a little bit more about seeing some positive sentiment from biotech customers. Are you also seeing something similar or what should we expect in the latter half of the year?
we we are what I would, I would uh,
And driving productivity on core labs, we think that.
I would characterize that in Market is is there's more clarity there.
Our multi omics business is well positioned to continue to support.
Core lab is and the pressure on getting more research out getting more data out in.
So we're doing that right now we feel pretty good about that.
I think that's going to continue on Mackenzie, but thank you for the question.
Mackenzie: Thanks. That's super helpful. And just to follow up on that, you talked a little bit about your pharma and biotech customers. What are you seeing from these end markets right now? Is pharma continuing to accelerate? And your peers have talked a little bit more about seeing some positive sentiment from biotech customers. Are you also seeing something similar, or what should we expect in the latter half of the year?
Mackenzie Strehle: Thanks. That's super helpful. And just to follow up on that, you talked a little bit about your pharma and biotech customers. What are you seeing from these end markets right now? Is pharma continuing to accelerate? And your peers have talked a little bit more about seeing some positive sentiment from biotech customers. Are you also seeing something similar, or what should we expect in the latter half of the year?
Thanks.
Paul.
Just a follow up on that you talked a little bit about your pharma and biotech customers. What are you seeing from these end markets right now is continuing to accelerate and your peers have talked a little bit more about seeing some positive sentiment from biotech customers are you also seeing something similar or what should we expect in the latter half of the year.
Than last year. What do I mean by that? A lot of restructuring, a lot of, um, there was uncertainty around what programs were going to continue and what we're what programs we're going to. Uh, they were going to double down on and invest behind. I think we've got, you know, our team and the conversations we're having from those. Uh, from those customers is, is Clarity. Here's what we're doing. We're moving forward in this direction and uh, we're we're clearly seeing that in in most of the segments of the, in our business.
John Marotta: We are. What I would characterize that end market is, is there's more clarity there than last year. What do I mean by that? So a lot of restructuring, a lot of, there was uncertainty around what programs were gonna continue and what programs were gonna, they were gonna double down on and invest behind. I think we've got, you know, our team and the conversations we're having from those, from those customers is, is clarity. Here's what we're doing, we're moving forward in this direction, and, we're, we're clearly seeing that in, in most of, the segments of the, in, in our business.
John Marotta: We are. What I would characterize that end market is, is there's more clarity there than last year. What do I mean by that? So a lot of restructuring, a lot of, there was uncertainty around what programs were gonna continue and what programs were gonna, they were gonna double down on and invest behind. I think we've got, you know, our team and the conversations we're having from those, from those customers is, is clarity. Here's what we're doing, we're moving forward in this direction, and, we're, we're clearly seeing that in, in most of, the segments of the, in, in our business.
We are.
You ladies and gentlemen, once again a reminder to please press star 1. Should you have any questions? Thank you.
I would.
I would characterize that end market is is there some more clarity there.
Next question will be from Andrew Cooper at Raymond James. Please go ahead. Andrew
And last year, what do I mean by that there are a lot of restructuring a lot of.
Hey everybody, thanks for the questions. Maybe just 1, 1 more kind of nitty-gritty on on
some of the, uh,
There was uncertainty around what programs, we're going to continue and what we're what programs, we're going to they were going to double down on and invest behind I think we've got.
The extra costs here on gross margin, so you call out to 3 to 5 million, that's 50 to 80 basis points or so.
Our team and the conversations we're having from those.
From those customers is clarity here's what we're doing we're moving forward in this direction and.
We're clearly seeing that.
Where where do you think you can find some of the offset their to achieve the 300 basis, point expansion. And I know you talked about the job being harder, but where are some of those places that you're looking to find that little bit of extra room, uh, or pull it a little bit forward from from fiscal 27 and how do we think about kind of what that looks like?
Most of the segments.
Our business.
Yeah, Andrew. Uh, thanks for the question. So
Operator: Thank you. Ladies and gentlemen, once again, a reminder to please press star one should you have any questions. Thank you. Next question will be from Andrew Cooper at Raymond James. Please go ahead, Andrew.
Operator: Thank you. Ladies and gentlemen, once again, a reminder to please press star one should you have any questions. Thank you. Next question will be from Andrew Cooper at Raymond James. Please go ahead, Andrew.
Thank you, ladies and gentlemen, once again, a reminder to please press star one should you have any questions. Thank you.
Next question will be from Andrew Cooper Raymond James. Please go ahead Andrew.
You know, a couple of things that we have in our favor and and, and, and John's right, you know, so our job got a little bit harder but we're certainly Point additional levers and let me get be more helpful on that.
Andrew Cooper: Hey, everybody. Thanks for the questions. Maybe just one, one more kind of nitty-gritty on some of the, the extra costs year on gross margin. So you call out the $3 to 5 million, that's 50 to 80 basis points or so. Where, where do you think you can find some of the offset there to achieve the 300 basis point expansion? And I know you talked about the job being harder, but where are some of those places that you're looking to find that little bit of extra room, or pull it a little bit forward from fiscal 2027, and how do we think about kind of what that looks like?
Andrew Cooper: Hey, everybody. Thanks for the questions. Maybe just one, one more kind of nitty-gritty on some of the, the extra costs year on gross margin. So you call out the $3 to 5 million, that's 50 to 80 basis points or so. Where, where do you think you can find some of the offset there to achieve the 300 basis point expansion? And I know you talked about the job being harder, but where are some of those places that you're looking to find that little bit of extra room, or pull it a little bit forward from fiscal 2027, and how do we think about kind of what that looks like?
Hey, everybody. Thanks for the questions, maybe just one on one more kind of nitty gritty on.
Some of the.
The extra costs year on gross margins you called out the $3 million to $5 million, that's 50 to 80 basis points or so.
Certainly, as we see the second half uh, increase in volumes, particularly around North America, generally we'll get a better mix, that's number 1,
Where do you think you can find some of the offset there to achieve the 300 basis point expansion I know you talked about the job being harder, but where some of those places that you are looking to find that little bit extra room or pull it a little bit forward from from fiscal 2017, and how do we think about kind of what that looks like.
Lawrence Lin: Yeah, Andrew, thanks for the question. So, you know, a couple of things that we have in our favor, and John's right, you know, our job got a little bit harder, but we're certainly pulling additional levers. Let me be more helpful on that. Certainly, as we see the second half increase in volumes, particularly around North America, generally, we'll get a better mix. That's number one. Secondly, around ABS and productivity, certainly areas like Kaizen events and in the labs in manufacturing, we've actually seen some really good results, preliminary, that we expect to read through. Other areas, such as automation in our biorepositories, are being accelerated to help us look at some recoveries. The one thing I would say, and I step back, is that one of the things we did in fiscal 2025 was to put
Lawrence Lin: Yeah, Andrew, thanks for the question. So, you know, a couple of things that we have in our favor, and John's right, you know, our job got a little bit harder, but we're certainly pulling additional levers. Let me be more helpful on that. Certainly, as we see the second half increase in volumes, particularly around North America, generally, we'll get a better mix. That's number one. Secondly, around ABS and productivity, certainly areas like Kaizen events and in the labs in manufacturing, we've actually seen some really good results, preliminary, that we expect to read through. Other areas, such as automation in our biorepositories, are being accelerated to help us look at some recoveries. The one thing I would say, and I step back, is that one of the things we did in fiscal 2025 was to put
Yes, Andrew Thanks for the question so.
A couple of things that we have in our favor and John's right.
So our job that a little bit harder, but we're certainly point additional levers and let me get be more helpful on that.
Certainly as we see the second half increase.
Other areas such as Automation, in our bio, repositories are being accelerated, to help us. Look at some recoveries. The 1 thing, I would say and I step back is that 1 of the things we did in fiscal 2025 was to put, uh, managers general managers in place of these businesses and that's really helped us
The increase in volumes, particularly around North America, generally we will get a better mix thats number one.
Get laser focused on operations and optimizing processes.
Secondly around around ABS and productivity.
Certainly areas like kaizen events.
In the labs and manufacturing, we've actually seen some really good results preliminary that we expect to read through.
Other areas such as automation in our bio repositories are being accelerated to help us look at some recoveries. The one thing I would say step back is that one of the things we did in fiscal 2005 was to put.
Uh, 1 more 2, more items. I think, you know, we're addressing, I think more acutely is around our fixed cost, in our Sanger business. Uh, and then finally, in really a celery opportunities around indirect cost savings, some of the workshops we run in the last couple of weeks are actually been yielding.
Meaningful opportunities for us to attack it.
John Marotta: ... managers, general managers in place of these businesses. And that's really helped us get laser-focused on operations and optimizing processes. One more-- two more items I think, you know, we're addressing, I think, more acutely, is around our fixed cost in our Sanger business. And then finally, in really accelerating opportunities around indirect cost savings. Some of the workshops we've run in the last couple of weeks are actually been yielding meaningful opportunities for us to attack it. So certainly, these have always been in our portfolio of levers to optimize our margin, but, with some of the, particularly the quality issue, we've really started to accelerate and, these initiatives.
John Marotta: ... managers, general managers in place of these businesses. And that's really helped us get laser-focused on operations and optimizing processes. One more-- two more items I think, you know, we're addressing, I think, more acutely, is around our fixed cost in our Sanger business. And then finally, in really accelerating opportunities around indirect cost savings. Some of the workshops we've run in the last couple of weeks are actually been yielding meaningful opportunities for us to attack it. So certainly, these have always been in our portfolio of levers to optimize our margin, but, with some of the, particularly the quality issue, we've really started to accelerate and, these initiatives.
Managers general managers in place of these businesses and that's really helped us.
so certainly these have always been in our portfolio of levers to optimize our margin but uh with some of the particularly the quality issue, we've really started to accelerate and uh, these initiatives
Get laser focused on operations and optimizing processes.
Okay, great. And then
maybe just a little bit kind of higher level 1, um,
One more two more items I think.
We're addressing I think more acutely is around our fixed cost in our Sanger business.
And then finally in release.
Celebrating opportunities around indirect cost savings some of those workshops, we run in the last couple of weeks are actually been yielding.
you know, in the past and at the investor day, you've talked about the notion of of leveraging, bundling a little bit more and kind of processing within segments. As opposed to necessarily across just would love a little bit of an update there. I know it's a noisy and Market environment kind of a board right now but have those conversations gone as you talk about trying to drive uh, kind of more of that breadth of portfolio at an individual customer level.
Meaningful opportunities for us at <unk>.
Certainly these have always been in our portfolio of levers to optimize our margin but.
With some of the.
Particularly the quality issue, we've really started to accelerate and.
Sure, Andrew. So, what I would, what I would say, from a customer perspective, a lot, a lot of that bundling, um, is, is basically within the segments, okay? So let me be more helpful.
These initiatives.
Andrew Cooper: Okay, great. And then maybe just a little bit kind of higher level one. You know, in the past, and at the Investor Day, you've talked about the notion of leveraging bundling a little bit more and kind of cross-selling within segments as opposed to necessarily across. Just would love a little bit of an update there. I know it's a noisy end-market environment, kind of across the board right now, but how have those conversations gone as you talk about trying to drive kind of more of that breadth of portfolio at an individual customer level?
Andrew Cooper: Okay, great. And then maybe just a little bit kind of higher level one. You know, in the past, and at the Investor Day, you've talked about the notion of leveraging bundling a little bit more and kind of cross-selling within segments as opposed to necessarily across. Just would love a little bit of an update there. I know it's a noisy end-market environment, kind of across the board right now, but how have those conversations gone as you talk about trying to drive kind of more of that breadth of portfolio at an individual customer level?
Okay, Great and then.
Maybe just a little bit kind of higher level one.
In the past and at the Investor Day, you've talked about the notion of leveraging bundling a little bit more and kind of cross selling within the segments as opposed to necessarily across just would love a little bit of an update there I know it's been a noisy end market environment kind of across the board right now, but how have those conversations Don as you talk about trying to drive.
Kind of more of that breadth of the portfolio at an individual customer level.
John Marotta: Sure, Andrew. So what I would say from a customer perspective, a lot of that bundling is basically within the segments, okay? So let me be more helpful. Specifically around kind of... Let's go from a Multiomics perspective. The one-stop shop is really important to customers, where they can-- we can read and write genes for them, specifically. That bundling is going very well. I mean, from a customer perspective, it's ease of use. We're working on more-- We've made more investments specifically around UX and UI to make that journey a little easier for customers to bundle using our e-commerce platform. So that-- those investments are in flight.
John Marotta: Sure, Andrew. So what I would say from a customer perspective, a lot of that bundling is basically within the segments, okay? So let me be more helpful. Specifically around kind of... Let's go from a Multiomics perspective. The one-stop shop is really important to customers, where they can-- we can read and write genes for them, specifically. That bundling is going very well. I mean, from a customer perspective, it's ease of use. We're working on more-- We've made more investments specifically around UX and UI to make that journey a little easier for customers to bundle using our e-commerce platform. So that-- those investments are in flight.
Sure Andrew So what I would what I would say from a customer perspective.
Uh, specifically around kind of, let's go from a, from a multi-omics perspective, the 1 Stop Shop is, um, really important to customers where they can we can read and write jeans for them specifically, um, that bundling is going very well. I mean, from a customer perspective, it's ease of use, we're working on more, we've made more Investments, uh, specifically around ux and UI to make that Journey, a little a little, uh, uh, easier for customers to, to bundle, uh, using our, uh, our e-commerce platform. So that those Investments are
Are in flight.
A lot a lot of that bundling.
Is is basically within the segments. Okay. So let me be more helpful.
Specifically around kind of scope from it from a multi omics perspective, the one stop shop.
Is.
Really important to customers, where they can we can read and write genes for them specifically.
That bundling is going very well I mean from a customer perspective, its ease of use we are working on more we've made more investments specifically around UX and UI to make that journey a little a little.
Um, where where uh we continue to see a lot of, uh, strength is in our cni business, continued to bundle, uh, instruments and consumables there. We're also seeing bundling with our stores. I mean it, if you look at these stores, some of them are 2 to 10 million sample opportunities. Our customers are using our consumables with those. We see higher asset rates in service so I think the teams have done a really nice job in in bundling within the segments,
Easier for customers to two bundle using our.
Our e-commerce platform, so that those investments are in flight.
John Marotta: Where we continue to see a lot of strength is in our CNI business, continue to bundle instruments and consumables there. We're also seeing bundling with our stores. I mean, if you look at these stores, some of them are 2 to 10 million sample opportunities. Our customers are using our consumables with those. We see high attachment rates in service. So I think the teams have done a really nice job in bundling within the segments. That is where our focus is because there's so much opportunity there. We don't want to confuse the organization and bundle, really, across the segments right now. There is an opportunity in academic and medical there, but it's an opportunity that we think will solve in different ways.
Where we are.
John Marotta: Where we continue to see a lot of strength is in our CNI business, continue to bundle instruments and consumables there. We're also seeing bundling with our stores. I mean, if you look at these stores, some of them are 2 million to 10 million sample opportunities. Our customers are using our consumables with those. We see high attachment rates in service. So I think the teams have done a really nice job in bundling within the segments. That is where our focus is because there's so much opportunity there. We don't want to confuse the organization and bundle, really, across the segments right now. There is an opportunity in academic and medical there, but it's an opportunity that we think will solve in different ways.
We continue to see a lot of strength is in our C&I business continue to bundle.
Instruments and consumables there, we're also seeing bundling with our stores.
If you look at these stores some of them are to that $10 million sample opportunities our customers are using our consumables with those we see high attachment rates and service.
The teams have done a really nice job in bundling within the segments.
For our focus is because there's so much opportunity there. We don't want to confuse the organization and bundle, a really across the segments right now. Um, there is an opportunity in academic and medical there, but it's it's an opportunity that, uh, we think will solve in in different ways, um, but right now, commercially, we're focused in the segments, similar with SRS our bio repository business. That team is done a, an excellent job of, uh, bundling more product solutions for our existing customers. As, you know, we do a really, we've got high market share, and, and active clinical trials. And we're, we're doing a lot in manufactured product and and some other areas right now. So, I'm very pleased with this. I mean, our breath and our ability to continue to
That is where our focus is because there's so much opportunity there we don't want to confuse the organization and bundle really across the segments right now.
Solve some of these issues for our customers, where they want to do business with.
There is an opportunity in academic and medical there, but it's an opportunity that.
With what what, what's clear to me is, uh, farm and biotech, they're consolidating suppliers where they want to do business with.
uh,
We think we'll solve in different ways.
John Marotta: But right now, commercially, we're focused in the segments, similar with SRS, our biorepository business. That team has done an excellent job of bundling more product solutions for our existing customers. As you know, we've got high market share in active clinical trials, and we're doing a lot in manufactured product and some other areas right now. So I'm very pleased with this. I mean, our breadth and our ability to continue to solve some of these issues for our customers, where they want to do business with...
John Marotta: But right now, commercially, we're focused in the segments, similar with SRS, our biorepository business. That team has done an excellent job of bundling more product solutions for our existing customers. As you know, we've got high market share in active clinical trials, and we're doing a lot in manufactured product and some other areas right now. So I'm very pleased with this. I mean, our breadth and our ability to continue to solve some of these issues for our customers, where they want to do business with...
But right now commercially we're focused in the segments similar with Srs or bio repository business that team has done an excellent job of.
Uh, partners that are high-quality, give them a fair price but give them a, a broader, a a broader reach of of products and solutions and and we're clearly Meeting those needs right now.
<unk>.
so, I hope that helps Andrew
Bundling more product solutions for our existing customers as you know we do we've got high market share in active clinical trials.
2.
Jeffrey's please go ahead, Matt.
We're doing a lot in manufactured product and some other areas right now so I'm very pleased with this I mean, our breadth and our ability to continue to solve some of these issues for our customers, where they want to do business with.
John Marotta: What's clear to me is pharma and biotech. They're consolidating suppliers where they want to do business with partners that are high quality, give them a fair price, but give them a broader reach of products and solutions, and we're clearly meeting those needs right now. So I hope that helps, Andrew.
John Marotta: What's clear to me is pharma and biotech. They're consolidating suppliers where they want to do business with partners that are high quality, give them a fair price, but give them a broader reach of products and solutions, and we're clearly meeting those needs right now. So I hope that helps, Andrew. Next is a follow-up from Matt Stanton at Jefferies. Please go ahead, Matt.
What's clear to me is.
Pharma and biotech theyre consolidating suppliers, where they wanted to do business with.
Partners that are high quality give them a fair price, but given the eight a broader a broader reach of our products and solutions.
Hey thanks 1 on Capital deployment. The message prior was like you're unlikely to do deals before the medical was completed. Now that that's set to hopefully close here shortly, the agreement is in hand, maybe John just talked a little bit about actionability, the funnel, any more color on on size of deals and I know historically uh share repurchases have been kind of down the pecking order for Capital deployment but with the the 250 million authorization out there um you know, posting any shift in appetite um around repurchases. Thanks.
Yeah, man. Uh
And we're clearly meeting those needs right now.
so, a couple things to think about, we are constantly comparing
That helps Andrew.
Operator: 2. Next is a follow-up from Matt Stanton at Jefferies. Please go ahead, Matt.
Okay.
Next is a follow up from Matt Stanton of Jefferies. Please go ahead ma'am.
Matthew Stanton: Hey, thanks. One on capital deployment. I think the message prior was likely—you're unlikely to do deals before B Medical was completed. Now that that's set to hopefully close here shortly, the agreement is in hand, maybe, John, just talk a little bit about actionability, the funnel, any more color on size of deals. And I know historically, share repurchases have been kind of down the pecking order for capital deployment, but with the $250 million authorization out there, you know, post the analyst day, any shift in appetite around repurchases? Thanks.
Matthew Stanton: Hey, thanks. One on capital deployment. I think the message prior was likely—you're unlikely to do deals before B Medical was completed. Now that that's set to hopefully close here shortly, the agreement is in hand, maybe, John, just talk a little bit about actionability, the funnel, any more color on size of deals. And I know historically, share repurchases have been kind of down the pecking order for capital deployment, but with the $250 million authorization out there, you know, post the analyst day, any shift in appetite around repurchases? Thanks.
Hey, Thanks, one on capital deployment and message. Prior was like you are unlikely to do deals before the medical is completed now that thats hopefully close here. Shortly the agreement is in hand, maybe John just talk a little bit about action ability of the funnel any more color on on size of deals and I know historically.
Share repurchases have been kind of down the pecking order for capital deployment, but with the $250 million authorization out there.
Our you know, we talked about before as our 4, levers to to for Capital deployment, around gross margin, productivity growth, specifically m&a and share repurchase. All of those are 3 levers. We always compare to BuyBacks and um we're going to be pulling all these, all 4 of these levers throughout this journey in the next few years. I can tell you that and um, in terms of actionability of We Are
Uh, we are very busy.
Post the analyst day any shift in appetite.
Around repurchases. Thanks.
John Marotta: Yeah, Matt. So a couple of things to think about. We are constantly comparing our... You know, what we talked about before is our four levers to for capital deployment around gross margin productivity, growth, specifically M&A and share repurchase. All of our three levers, we always compare to buybacks, and we're gonna be pulling all four of these levers throughout this journey in the next few years. I can tell you that. And in terms of actionability, we are very busy around M&A right now, specifically, and we're very excited about what is in our hands right now.... We're gonna continue to put our capital to work in this area. But again, I think you're gonna see us pull all four of these levers.
John Marotta: Yeah, Matt. So a couple of things to think about. We are constantly comparing our... You know, what we talked about before is our four levers to for capital deployment around gross margin productivity, growth, specifically M&A and share repurchase. All of our three levers, we always compare to buybacks, and we're gonna be pulling all four of these levers throughout this journey in the next few years. I can tell you that. And in terms of actionability, we are very busy around M&A right now, specifically, and we're very excited about what is in our hands right now.... We're gonna continue to put our capital to work in this area. But again, I think you're gonna see us pull all four of these levers.
Yes, Matt.
So a couple of things to think about we are constantly comparing.
Are we talked about before is our four levers.
Around m&a right now specifically and we're very excited about what is in our hands right now. Um, we're going to continue to put our Capital to work in this area but again I think you're going to see us pull all 4 of these levels levers. I I you know, I've mentioned this before but it it's worth repeating.
For capital deployment around gross margin productivity growth, specifically M&A and share repurchase all of our three levers, we always compare to buybacks and.
We're going to be pulling all of these all four of these levers throughout this journey in the next few years I can tell you that.
And.
In terms of action ability.
We are.
We are very busy.
Around M&A right now specifically and we're very excited about what is in our hands right now.
We want our investors to come away and say, Hey, listen, these guys are are are good operators. They've got a grip on the business. Yes, there's not a lot of linearity to turn arounds, but we understand it. They're calling balls and Strikes. And they're very, they're very, um, straightforward about the journey. We're on, on the operating side, on the capitol allocating side. We also want our investors to come away and say, hey, they're very thoughtful Capital allocators, they understand how this works. And we're always looking at uh, uh, those Returns versus share repurchase.
We're going to continue to put our capital to work in this area, but again I think youre going to see us pull all four of these levels levers.
you know, last point on it is, I think you're going to see us pull all 4 of those levers
Thank you.
John Marotta: You know, I've mentioned this before, but it's worth repeating. We want our investors to come away and say, "Hey, listen, these guys are good operators. They've got a grip on the business. Yes, there's not a lot of linearity to turnarounds, but we understand it. They're calling balls and strikes, and they're very straightforward about the journey we're on, on the operating side." On the capital allocating side, we also want our investors to come away and say, "Hey, they're very thoughtful capital allocators. They understand how this works," and we're always looking at those returns versus share repurchase. You know, last point on it is, I think you're gonna see us pull all four of those levers.
John Marotta: You know, I've mentioned this before, but it's worth repeating. We want our investors to come away and say, "Hey, listen, these guys are good operators. They've got a grip on the business. Yes, there's not a lot of linearity to turnarounds, but we understand it. They're calling balls and strikes, and they're very straightforward about the journey we're on, on the operating side." On the capital allocating side, we also want our investors to come away and say, "Hey, they're very thoughtful capital allocators. They understand how this works," and we're always looking at those returns versus share repurchase. You know, last point on it is, I think you're gonna see us pull all four of those levers.
I've mentioned this before but it's worth repeating we want our investors to come away and say hey.
Next question will be from Paul Knight at KeyBank. Please. Go ahead Paul.
hi, John, as you, uh, remediated these automatic stores, uh,
These guys are good operators, they've got a grip on the business. Yes, there is not a lot of linearity to turnarounds, but we understand it they are calling balls and strikes and they're very they're very.
2 left out of 18 or uh, these permanent fixes, uh, was there a commonality? A, what you saw it. So, you know, is this kind of behind us now,
Straightforward about the journey, we're on on the operating side on the capital allocation side. We also want our investors to come away and say hey, they're very thoughtful capital allocators. They understand how this works and we're always looking at.
Yeah, Paul good to hear from you a thoughtful question.
So a couple things to think about, I mean, we have been
we have been, uh, really
Those returns versus share repurchase.
Last point on is I think youre going to see us pull all four of those levers.
Operator: Thank you. Next question will be from Paul Knight at KeyBanc. Please go ahead, Paul.
Operator: Thank you. Next question will be from Paul Knight at KeyBanc. Please go ahead, Paul.
Okay.
Dealing with this issue since we started. Okay, when we started getting to business, we weren't meeting our customers needs 18 stores issues. So that, that's that that's the last few years of sales. We've had these problems in
Next question will be from Paul Knight at Keybanc. Please go ahead Paul.
Paul Knight: Hi, John. As you remediated these automated stores QC issues, and I think it's, what, 2 left out of 18. Are these permanent fixes? Was there a commonality of what you saw, and so, you know, is this kind of behind us now?
Paul Knight: Hi, John. As you remediated these automated stores QC issues, and I think it's, what, two left out of 18. Are these permanent fixes? Was there a commonality of what you saw, and so, you know, is this kind of behind us now?
Hi, John as you will remediate these automatic stores QC issues and I think it's what's two left out of 18.
and, you know, bluntly if you're not, delighting your customers, what are we here to do? So we, we attacked this head-on.
<unk>.
These permanent fixes or was there a commonality of what you saw and so.
All 18 of the stores, understanding. What were our offsets? What do we have to count and measure? And how do we go out and Delight our customers? So we've been spending a lot of money around that
Is this kind of behind us now.
I've been personally meeting with our customers all of them around these stores. So that was the first thing is
John Marotta: Yeah. Paul, good to hear from you. A thoughtful question. So a couple of things to think about. I mean, we have been, we have been, really dealing with this issue since we started, okay? When we started to get into business, we weren't meeting our customers' needs. 18 stores issues, so that's, that's the last few years of sales we've had these problems in. And, you know, bluntly, if you're not delighting your customers, what are we here to do? So we, we attacked this head-on. All 18 of the stores, understanding what were our offsets, what do we have to countermeasure, and how do we go out and delight our customers? So we've been spending a lot of money around that. I've been personally meeting with our customers, all of them, around these stores. So that was the first thing, is what was the specific issue?
John Marotta: Yeah. Paul, good to hear from you. A thoughtful question. So a couple of things to think about. I mean, we have been, we have been, really dealing with this issue since we started, okay? When we started to get into business, we weren't meeting our customers' needs. 18 stores issues, so that's, that's the last few years of sales we've had these problems in. And, you know, bluntly, if you're not delighting your customers, what are we here to do? So we, we attacked this head-on. All 18 of the stores, understanding what were our offsets, what do we have to countermeasure, and how do we go out and delight our customers? So we've been spending a lot of money around that. I've been personally meeting with our customers, all of them, around these stores. So that was the first thing, is what was the specific issue?
Paul Good to hear from you a thoughtful question.
So a couple of things to think about I mean, we have been we have been.
Really.
Dealing with this issue since we started when we started to get the business, we werent meeting our customers' needs 18 stores issues. So that's.
What was the specific issue? How do we go solve that real time for our customers and get them operational? The second is how, what is the permanent fix in? Which we're doing this from a design perspective. I can tell you, we've got great R&D teams. Okay, so what were our our what was the issue? Ultimately, we had too much demand
That's the last few years of sales we've had these problems in.
<unk>.
Bluntly, if youre not providing your customers what are we here to do so we attack. This head on all 18 of the stores understanding what were our offsets what do we have to countermeasure and how do we go out and delight our customers. So we've been spent a lot of money around that I've been personally meeting with our customers all around the store.
The teams were being stretched and we weren't structurally aligned around serving our customers. What do you have to do? Their first thing is structurally aligned yourself to go win. For the customer 1 is around new product development.
So that was the first day is.
2 is around POC, that business is a PC business. The percentage of completion and 3 are around sustaining engineering, we have restructured that R&D team where we have teams that wake up every day around MPD MPI.
What was the specific issue how do we go solve that real time for our customers and get them operational.
John Marotta: How do we go solve that real-time for our customers and get them operational? The second is, what is the permanent fix in which we're doing this from a design perspective? I can tell you, we've got great R&D teams, okay? So what was the issue, ultimately? We had too much demand, the teams were being stretched, and we weren't structurally aligned around serving our customers. What do you have to do there? First thing is structurally align yourself to go win for the customer. One, is around new product development. Two, is around POC. That business is a POC business, percentage of completion, and three, around sustaining engineering. We have restructured that R&D team where we have teams that wake up every day around MPD, MPI, POC separately, and sustaining engineering, okay? That was the big step that we've made.
John Marotta: How do we go solve that real-time for our customers and get them operational? The second is, what is the permanent fix in which we're doing this from a design perspective? I can tell you, we've got great R&D teams, okay? So what was the issue, ultimately? We had too much demand, the teams were being stretched, and we weren't structurally aligned around serving our customers. What do you have to do there? First thing is structurally align yourself to go win for the customer. One, is around new product development. Two, is around POC. That business is a POC business, percentage of completion, and three, around sustaining engineering. We have restructured that R&D team where we have teams that wake up every day around MPD, MPI, POC separately, and sustaining engineering, okay? That was the big step that we've made.
PC separately and and sustaining engineering. Okay.
Second is how what is the permanent fix in which we're doing this from a design perspective I can tell you. We've got great R&D teams. Okay. So what were or what was the issue ultimately we had too much demand.
The teams were being stretched and we werent structurally aligned around serving our customers what do you have to do there.
Specifically around getting line of sight on this PC, getting us more in control and going out, and delighting our customers and putting our best foot forward.
First thing is structurally aligned yourself to go win for the customer one is around new product development too.
So we've done that. Um we are lapping that listen, there's always a cost of poor quality.
whether that is you,
<unk> is around POC that business is a POC business.
<unk> completion and three around sustaining engineering, we have restructured that R&D team, where we have teams that wake up every day around MPD.
You delay, your MPI projects, whether you um, are not meeting the customer's needs and from a brand perspective, but we have gone in and we're meeting those customers where they are today. I personally met with them and
Hi.
Separately and sustaining engineering okay.
That was the big step that we've made there are some tweaks on the design side all of that has been implemented and I'm pleased to say that moving forward here.
John Marotta: There's some tweaks on the design side. All of that has been implemented, and I'm pleased to say that moving forward here, ABS has really helped us specifically around getting line of sight on this POC, getting us more in control, and going out and delighting our customers and putting our best foot forward. So we've done that. We are lapping that. Listen, there's always a cost to poor quality, whether that is you delay your MPI projects, whether you are not meeting the customer's needs and from a brand perspective, but we have gone in, and we're meeting those customers where they are today. I personally met with them, and it just is part of the turnaround journey, Paul, but I'm very, very pleased at how the team has responded.
John Marotta: There's some tweaks on the design side. All of that has been implemented, and I'm pleased to say that moving forward here, ABS has really helped us specifically around getting line of sight on this POC, getting us more in control, and going out and delighting our customers and putting our best foot forward. So we've done that. We are lapping that. Listen, there's always a cost to poor quality, whether that is you delay your MPI projects, whether you are not meeting the customer's needs and from a brand perspective, but we have gone in, and we're meeting those customers where they are today. I personally met with them, and it just is part of the turnaround journey, Paul, but I'm very, very pleased at how the team has responded.
<unk> has really helped us specifically around getting line of sight on this POC getting us more in control and going out delighting, our customers and putting our best foot forward.
It just is part of the turnaround Journey Paul. But uh, I'm very, very pleased that that how the team has responded. I mean that's the mark of a good organization. Is how do you respond this adversity? How are the customers understanding this and are you making it right? And the bottom line is, we're doing that right now. So we're lapping it. Um,
So we've done that.
We are lapping that listen there's always a cost of poor quality.
Whether it is you.
You delay your NPI projects, whether you.
Are not meeting the customers' needs it from a brand perspective, but we have gone in and we're meeting those customers where they are today I personally met with them.
Some of these have taken more time than we expected, but we've got a grip on that right now. And there's clear line of sight there. So hopefully that helps Paul. Yeah. Last question would be Sanger is down, but what was the growth of uh NextGen in is the increasing accuracy of NextGen really 1 of the reasons why he's saying, you're finally is uh, maybe shrinking as a part of Market.
And it just as part of the turnaround journey, Paul but I'm very very pleased at how the team has responded I mean, that's the mark of a good organization is how do you respond. This adversity how are the customers understanding this and are you, making it right. The bottom line is we're doing that right now so we're lapping it.
John Marotta: I mean, that's the mark of a good organization: how do you respond to this adversity? How are the customers understanding this, and are you making it right? The bottom line is we're doing that right now. So we're lapping it. Some of these have taken more time than we expected, but we've got a grip on that right now, and there's a clear line of sight there. So hopefully, that helps, Paul.
John Marotta: I mean, that's the mark of a good organization: how do you respond to this adversity? How are the customers understanding this, and are you making it right? The bottom line is we're doing that right now. So we're lapping it. Some of these have taken more time than we expected, but we've got a grip on that right now, and there's a clear line of sight there. So hopefully, that helps, Paul.
Yeah, you know this Sanger we've been we've been talking about Sanger for a while here, I'd rather not, but um, let's let's let's just address it. So the NextGen plasma easy, I mean that is a mid single-digit grower for us, we work Dublin, that size of that business. Um we told the team and we invested heavily behind it so this shouldn't be a hobby for us.
<unk>.
Some of these have taken more time than we expected, but we've got a grip on that right now and Theres clear line of sight. There. So hopefully that helps Paul Yes last question would be Sanger is down but what was the growth of next gen and as the increasing accuracy of Nextgen really.
We have a broad footprint, 4,000, we've got 4,000, drop boxes globally.
Paul Knight: Yeah. Last question would be, Sanger is down, but what was the growth of NextGen? And is the increasing accuracy of NextGen really one of the reasons why Sanger finally is maybe shrinking as a part of market?
Paul Knight: Yeah. Last question would be, Sanger is down, but what was the growth of NextGen? And is the increasing accuracy of NextGen really one of the reasons why Sanger finally is maybe shrinking as a part of market?
One of the reasons why saying, you're finally is shrinking as a part of market.
John Marotta: Yeah, you know, this Sanger. We've been talking about Sanger for a while. I'd rather not, but let's address it. So the Next-Gen Plasmid-EZ, I mean, that is a mid-single-digit grower for us. We're doubling that size of that business. We told the team, and we invested heavily behind it, said, "This shouldn't be a hobby for us." We have a broad footprint, 4,000 drop boxes globally. We should have been investing in this earlier. We are now very heavily, and we're growing it nicely. So we're doubling our growth there. That's one part of it. Sanger, as you know. I mean, I have to tell you, Paul, I've been out, talked to a lot of customers. I've talked to a lot of our sales reps. We're triangulating in on this. It's not going away.
John Marotta: Yeah, you know, this Sanger. We've been talking about Sanger for a while. I'd rather not, but let's address it. So the Next-Gen Plasmid-EZ, I mean, that is a mid-single-digit grower for us. We're doubling that size of that business. We told the team, and we invested heavily behind it, said, "This shouldn't be a hobby for us." We have a broad footprint, 4,000 drop boxes globally. We should have been investing in this earlier. We are now very heavily, and we're growing it nicely. So we're doubling our growth there. That's one part of it. Sanger, as you know. I mean, I have to tell you, Paul, I've been out, talked to a lot of customers. I've talked to a lot of our sales reps. We're triangulating in on this. It's not going away.
Yes.
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We've been we've been talking about Sanger for a wildly I'd rather not but.
We should have been investing in this earlier. We are now very heavily and we're growing at nicely. So we're doubling our our, our our growth there, that's 1 part of it Sanger is, you know, I mean, I have to tell you Paul, I've been out talked to a lot of customers. I've talked to a lot of our sales reps, we're triangulating in on this. It's not going away. There's a clear need
Let's let's address it so the nextgen plasma easy I mean that is a mid single digit grower for us we've worked doubling that size of that business.
From an End Market perspective and a customer perspective with Sanger.
Then the question is is where's the bottom? And how do you right size? Your cost structure?
We told the team and we invested heavily behind this shouldnt be a hobby for us we have a broad footprint 4000, we've got 4000 Dropbox is globally.
We should have been investing in this earlier, we are now very heavily and we're growing it nicely. So we are doubling our our growth there that's one part of it.
Bottom line is, we don't know where the bottom is. Yet in Sanger, but we are right sizing our, our cost structure around that. So I I would I would tell you that's more on the come. But in general, um, we're well aware of what's going on in Sanger. And more importantly, we're more focused around growth. In terms of that plasma easy to offset that. I'll tell you the team's done a nice job there. Um, you know, it was an area bluntly where when we came into the business last year, I said, what's going on here?
<unk> as you know I mean I have to tell you Paul I've been out talking to a lot of customers I talked a lot of our sales reps. We're triangulating in on this it's not going away there is a clear need.
You know, we need to be investing heavily here and we've done that.
Thank you.
John Marotta: There's a clear need from an end market perspective and a customer perspective with Sanger. Then the question is, where's the bottom, and how do you right-size your cost structure? The bottom line is, we don't know where the bottom is yet in Sanger, but we are right-sizing our cost structure around that. So I would tell you that's more on the come. But in general, we're well aware of what's going on in Sanger, and more importantly, we're more focused around growth in terms of that Plasmid-EZ to offset that. I'll tell you, the team's done a nice job there. You know, it was an area, bluntly, where when we came into the business last year, I said, "What's going on here?" You know, we need to be investing heavily here, and we've done that.
John Marotta: There's a clear need from an end market perspective and a customer perspective with Sanger. Then the question is, where's the bottom, and how do you right-size your cost structure? The bottom line is, we don't know where the bottom is yet in Sanger, but we are right-sizing our cost structure around that. So I would tell you that's more on the come. But in general, we're well aware of what's going on in Sanger, and more importantly, we're more focused around growth in terms of that Plasmid-EZ to offset that. I'll tell you, the team's done a nice job there. You know, it was an area, bluntly, where when we came into the business last year, I said, "What's going on here?" You know, we need to be investing heavily here, and we've done that.
From an end market perspective customer perspective with Cerner.
Next question, will be from Brandon Smith at TD Cowen. Please go ahead. Brandon
Great. Thank you for taking the questions.
Then the question is where is the bottom and how do you right size your cost structure.
The bottom line is we don't know where the bottom is yet in sanger, but we are right sizing our cost structure around that so I would I would tell you that's more on the come but in general we're.
Well aware of what's going on in Sanger and more importantly, we are more focused around growth in terms of that plasma easy to offset that I'll tell you. The team has done a nice job there.
Uh maybe just first actually on the regionalization uh, of multiomics and NGS Services. How should we maybe think about impact to margins their relative to kind of what you're doing and by our repositories and automated stores, just over the next couple of quarters. Um especially in the context of your commentary and margin expansion this year. Really just trying to kind of understand the relative pushes and pulls I guess across segments as your restructuring. Um, and then I have a follow-up.
It was an area bluntly when we came into the business last year I said, what's going on here.
We need to be investing heavily here we've done that.
Operator: Thank you. Next question will be from Brendan Smith at TD Cowen. Please go ahead, Brendan.
Operator: Thank you. Next question will be from Brendan Smith at TD Cowen. Please go ahead, Brendan.
Thank you.
Next question will be from Brandon Smith at TD Cowen. Please go ahead Brandon.
Sure Brandon yeah, good good always. Good to hear from you. So, um, Lawrence can get into the particulars around this, but we all of that is forecasted. Good line of sight into what we want to do there. Uh, from a regionalization perspective, specifically around synthesis. I mean, we're we're very pleased with our how we are. Um,
Brendan Smith: Great. Thanks for taking the questions, guys. Maybe just first, actually, on the regionalization of Multiomics and NGS services, how should we maybe think about impact to margins there relative to kind of what you're doing in biorepositories and automated stores just over the next couple of quarters? Especially in the context of your commentary on margin expansion this year. Really just trying to kinda understand the relative pushes and pulls, I guess, across segments as you're restructuring. And then I have a follow-up.
Brendan Smith: Great. Thanks for taking the questions, guys. Maybe just first, actually, on the regionalization of Multiomics and NGS services, how should we maybe think about impact to margins there relative to kind of what you're doing in biorepositories and automated stores just over the next couple of quarters? Especially in the context of your commentary on margin expansion this year. Really just trying to kinda understand the relative pushes and pulls, I guess, across segments as you're restructuring. And then I have a follow-up.
Great. Thanks for taking the questions guys, maybe just first actually on the regionalization of multi Omics and engineering services.
How should we maybe think about impact to margins there relative to kind of what youre doing and buy a depository automated stores just over the next couple of quarters.
Moving into that strategy right now and executing on that strategy, uh, I think you're going to be hearing more about that in in the coming months.
Uh,
Especially in the context of your commentary on margin expansion. This year really just trying to kind of understand the relative pushes and pulls I guess across segments as the restructuring and then I have a follow up.
John Marotta: Sure, Brendan. Yeah, good, good. Always good to hear from you. So, Lawrence can get into the particulars around this, but we all of that's forecasted, good line of sight into what we wanna do there, from a regionalization perspective, specifically around synthesis. I mean, we're very pleased with our how we are moving into that strategy right now and executing on that strategy. I think you're gonna be hearing more about that in the coming months. You know, our gross margin, we make a we do well. I mean, that's a 65+ gross margin product category for us. Yes, you know, we're seeing some North America share loss in synthesis, but we're also seeing some traction in certain areas right now in North America. So there's a bit of an offset right now, specifically.
John Marotta: Sure, Brendan. Yeah, good, good. Always good to hear from you. So, Lawrence can get into the particulars around this, but we all of that's forecasted, good line of sight into what we wanna do there, from a regionalization perspective, specifically around synthesis. I mean, we're very pleased with our how we are moving into that strategy right now and executing on that strategy. I think you're gonna be hearing more about that in the coming months. You know, our gross margin, we make a we do well. I mean, that's a 65+ gross margin product category for us. Yes, you know, we're seeing some North America share loss in synthesis, but we're also seeing some traction in certain areas right now in North America. So there's a bit of an offset right now, specifically.
Sure Brian.
Always good to hear from you so.
Laurence can get into the particulars around this but we all have that forecasted good line of sight into what we wanted to do there.
You know, our gross margin. We make we do well I mean that's a 65 plus gross margin product category for us. Um yes uh you know we're seeing some North America share loss uh in synthesis but we're also seeing some Traction in certain areas right now in North America. So there's a bit of an offset right now.
Specifically, I think you're going to see um, gross margin improving.
From a regionalization perspective, specifically around synthesis.
We're very pleased with our how we are.
Certain areas because of our automation Investments but some of the technology side that we've got in our hands as well. So more to come on that specifically
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Moving into that strategy right now and executing on that strategy.
I think youre going to be hearing more about that in the coming months.
Our gross margin.
We do well I mean, that's a 65 plus gross margin product category for us.
Yes.
We're seeing some north America share loss.
In synthesis, but we're also seeing some traction in certain areas right now in North America. So there's a bit of an offset right now specifically.
Yeah, Brandon I I you know, certainly really pleased with what the China team is doing, but when you look at kind of the dynamic of Asia and North America, they're lower margins in total for a multiomics. As we talked about certainly we we've got a North America sales, uh, Team reboot here. That certainly will read through in a second and a half year. So you're going to see a significant ramp in North America which really does translate to a higher gross margin profile overall
John Marotta: I think you're gonna see gross margin improving in certain areas because of our automation investments, but some of the technology side that we've got on our hands as well. So more to come on that, specifically.
John Marotta: I think you're gonna see gross margin improving in certain areas because of our automation investments, but some of the technology side that we've got on our hands as well. So more to come on that, specifically.
Thank you are going to see.
Gross margin improving.
In certain areas because of our automation investments, but some of the technology side that we've got in our hands as well so more to come on that specifically.
Lawrence Lin: Yeah, Brandon, you know, certainly really pleased with what the China team is doing, but when you look at kind of the dynamic of Asia and North America, they're lower margins in total for Multiomics. As we talked about, certainly, we've got a North America sales team reboot here that certainly will read through in the second half year. So you're gonna see a significant ramp in North America, which really does translate to a higher gross margin profile overall.
Lawrence Lin: Yeah, Brendan, you know, certainly really pleased with what the China team is doing, but when you look at kind of the dynamic of Asia and North America, they're lower margins in total for Multiomics. As we talked about, certainly, we've got a North America sales team reboot here that certainly will read through in the second half year. So you're gonna see a significant ramp in North America, which really does translate to a higher gross margin profile overall.
Yes Brendan.
Certainly really pleased with what the China team is doing but when you look at kind of the dynamic of Asia and North America. There are lower margins in total for a multi omics as we talked about certainly we've got our North America sales team reboot here that certainly will read through in second half year.
great. Thanks guys. And actually you just took a question of my mouth, just on the NDS strength in China. Uh, I think you noted in 26% organic growth therapy. I'm not mistaken. So can you just quickly maybe give us a sense of what you're seeing. That's kind of underpinning that and if you expect um kind of growth at that rate to continue over 26. Thanks. Yeah. You bet um biotech and farmer are uh
So youre going to see a significant ramp in North America, which really does translate to a higher gross margin profile overall.
I mean, they're really, uh, we're seeing a lot of momentum in, in that segment, we've always been well, positioned because of our China for China. Uh, Brands. Go to market very Regional, um, we show up. I mean, our our China team,
uh, is fantastic if you if you look at
Brendan Smith: Great. Thanks, guys. And actually, you just took the question out of my mouth, just on the NGS strength in China. I think you noted 26% of organic growth there, if I'm not mistaken. So can you just quickly maybe give us a sense of what you're seeing that's kind of underpinning that, and if you expect kind of growth at that rate to continue over 26? Thanks, guys.
Brendan Smith: Great. Thanks, guys. And actually, you just took the question out of my mouth, just on the NGS strength in China. I think you noted 26% of organic growth there, if I'm not mistaken. So can you just quickly maybe give us a sense of what you're seeing that's kind of underpinning that, and if you expect kind of growth at that rate to continue over 26? Thanks, guys.
Great. Thanks, guys and actually you just quick question. If I may ask just on the strength in China. I think you noted 26% of organic growth there if I'm not mistaken, but can you just quickly maybe give us a sense of what youre seeing is kind of underpinning that and if you expect.
And growth at that rate to continue over 26, thanks, guys you bet.
Kind of the framework that we looked at in our business, in general, it's people structure process and performance that team is is hitting on all cylinders. And so you're seeing that read through on the results right now, of course, uh in other regions, it's a mixed bag right now because we're we're in the turnaround.
John Marotta: Yeah, you bet. Biotech and pharma are, I mean, they're really, we're seeing a lot of momentum in that segment. We've always been well-positioned because of our China for China, brands, go-to-market, very regional. We show up, I mean, our China team is fantastic. If you look at kind of the framework that we look at in our business in general, it's people, structure, process, and performance. That team is hitting on all cylinders. And so you're seeing that read through on the results right now. Of course, in other regions, it's a mixed bag right now because we're in the turnaround. But our China team shows up really well with our customers in pharma and biotech. A lot of investment going into those end markets right now.
John Marotta: Yeah, you bet. Biotech and pharma are, I mean, they're really, we're seeing a lot of momentum in that segment. We've always been well-positioned because of our China for China, brands, go-to-market, very regional. We show up, I mean, our China team is fantastic. If you look at kind of the framework that we look at in our business in general, it's people, structure, process, and performance. That team is hitting on all cylinders. And so you're seeing that read through on the results right now. Of course, in other regions, it's a mixed bag right now because we're in the turnaround. But our China team shows up really well with our customers in pharma and biotech. A lot of investment going into those end markets right now.
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Biotech and pharma are.
They are really.
We're seeing a lot of momentum in that segment, we've always been well positioned because of our China for China.
Uh but our China team shows up really well with our customers in in farm and biotech. Um, a lot of investment going into those and markets right now, as you know, uh, geopolitically I think and we've we've shared this. Um,
Brands go to market very regional.
We show up.
Our China team.
It's fantastic if you if you look at.
Kind of the framework that we look at in our business in general it's people structure process and performance that team is is hitting on all cylinders.
And so youre seeing that read through in our results right now of course in other regions. It's a mixed bag right now because we're in the turnaround.
With with with you all separately but I think it merits a a a a broader comment here publicly. You know where I think geopolitically, there's a lot of focus around kind of 5G 6G Quantum Ai and semi biotech and Life Sciences. We're also seeing that read through. Um and and China uh, is is uh very much investing behind that life sciences and biotech sector and and and that's where our team shows up really, really well.
But our China team shows up really well with our customers in pharma and biotech.
2, ladies and gentlemen, at this time, we have no other questions registered. So I would like to turn the call back over to CEO John marotta.
A lot of investment going into those end markets right now as you know geopolitically I think.
John Marotta: As you know, geopolitically, I think, and we've shared this with you all separately, but I think it merits a broader comment here publicly. You know, where I think geopolitically, there's a lot of focus around kind of 5G, 6G, quantum, AI, and semi, biotech and life sciences, we're also seeing that read-through, and China is very much investing behind that life sciences and biotech sector, and that's where our team shows up really, really well.
John Marotta: As you know, geopolitically, I think, and we've shared this with you all separately, but I think it merits a broader comment here publicly. You know, where I think geopolitically, there's a lot of focus around kind of 5G, 6G, quantum, AI, and semi, biotech and life sciences, we're also seeing that read-through, and China is very much investing behind that life sciences and biotech sector, and that's where our team shows up really, really well.
We've shared this.
With with with you all separately, but I think it merits.
Very good. Thank you all and and first off I want to thank the team as always, I mean, nothing gets done without our team showing up every single day and we're really proud of of uh the direction we're going in and and our leaders here.
A broader comment here publicly.
Where I think geopolitically, there's a lot of focus around kind of <unk> quantum AI and semi biotech and life Sciences were also seeing that read through.
And in China.
Is very much investing behind that life sciences, and biotech sector, and that's where our team shows up really really well.
As well as our individual team members. I want to thank you for joining our earnings call today in summary. We're continuing, uh, the work we're doing in the companywide, turnaround and transformation. This is an important Journey we're on. And we're, we're very excited about creating long-term shareholder value over the next few years. Thank you again.
Operator: Thank you. Ladies and gentlemen, at this time, we have no other questions registered, so I would like to turn the call back over to CEO, John Marotta.
Operator: Thank you. Ladies and gentlemen, at this time, we have no other questions registered, so I would like to turn the call back over to CEO, John Marotta.
Thank you.
Ladies and gentlemen at this time, we have no other questions registered so I would like to turn the call back over to CEO John Marotta.
Thank you, sir. Ladies and gentlemen, this is indeed include your conference call for today. Once again, thank you for attending. And at this time we do ask that you, please disconnect your lines, enjoy the rest of your day.
John Marotta: Very good. Thank you all. First off, I wanna thank the team, as always. I mean, nothing gets done without our team showing up every single day, and we're really proud of the direction we're going in, and our leaders here, as well as our individual team members. I wanna thank you for joining our earnings call today. In summary, we're continuing the work we're doing in the company-wide turnaround and transformation. This is an important journey we're on, and we're very excited about creating long-term shareholder value over the next few years. Thank you again.
John Marotta: Very good. Thank you all. First off, I wanna thank the team, as always. I mean, nothing gets done without our team showing up every single day, and we're really proud of the direction we're going in, and our leaders here, as well as our individual team members. I wanna thank you for joining our earnings call today. In summary, we're continuing the work we're doing in the company-wide turnaround and transformation. This is an important journey we're on, and we're very excited about creating long-term shareholder value over the next few years. Thank you again.
Very good. Thank you all and first off I want to thank the team as always I mean, nothing gets done without our team showing up every single day and we're really proud of.
The direction, we're going in and our leaders here.
As well as our individual team members I want to thank you for joining our earnings call today in summary were continuing.
Work, we're doing in the company wide turnaround and transformation. This is an important journey, we're on and we're very excited about creating long term shareholder value over the next few years. Thank you again.
Operator: Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending, and at this time, we do ask that you please disconnect your lines. Enjoy the rest of your day.
Operator: Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending, and at this time, we do ask that you please disconnect your lines. Enjoy the rest of your day.
Thank you, Sir ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending and at this time, we do ask that you. Please disconnect your lines Android the rest of your day.
