Company Overview - Repligen Corporation is a global life sciences company focused on developing and commercializing innovative bioprocessing technologies and systems that enhance the manufacturing efficiency of biological drugs [3] - The company primarily serves biopharmaceutical drug developers and contract development and manufacturing organizations (CDMOs) worldwide [3] - Key focus areas include Filtration and Fluid Management, Chromatography, Process Analytics, and Proteins [3] Upcoming Event - Repligen will participate in the William Blair 45th Annual Growth Stock Conference from June 3 to June 5 in Chicago [1] - Olivier Loeillot, President and CEO, is scheduled to present a company overview on June 3 at 1:20 p.m. CT [1] - A live webcast of the presentation will be available on Repligen's Investor Relations website and will be accessible for replay for a limited time after the event [2]

Summary of Repligen (RGEN) Conference Call Company Overview - **Company**: Repligen Corporation (RGEN) - **Event**: RBC Capital Markets 2025 Global Healthcare Conference - **Date**: May 20, 2025 Key Points Financial Guidance and Performance - The guidance for Q1 included the acquisition of the nine zero eight devices, contributing approximately $10 million in sales, slightly accretive to gross margin but dilutive to operating margin by 50 basis points [2][3] - Foreign exchange (FX) had a significant impact, initially projected as a 1.5-point headwind but later adjusted to a 0.5-point tailwind, indicating improved conditions [3][5] - Tariffs were not included in the initial guidance, but potential sales increases from surcharges and pricing adjustments were noted, estimated at just under a point of sales increase [5][9] Tariff Impacts - Majority of manufacturing is in the U.S., with 90% of U.S. sales also produced domestically, minimizing tariff impacts [9][10] - Approximately 2% of sales are exposed to China, with less than $5 million in sales exposure anticipated due to tariffs [12][13] - The company is exploring dual manufacturing capabilities in Europe to mitigate potential tariff impacts [16][18] - Customer response to surcharges has been generally positive, with no significant pushback reported [21][22] Market Dynamics and Growth - Repligen reported a 14% growth in Q1, significantly above the high single-digit growth of the bioproduction market, indicating strong performance [29][32] - The company expects organic non-COVID growth to be between 11.5% and 15.5% for the year, aligning with broader market trends [31][32] - The ATF (Alternating Tangential Flow) product line is expected to see growth in the second half of the year, despite tough comparisons in Q1 [34][36] Customer Engagement and Opportunities - Repligen is engaged with nine out of the ten largest Contract Development and Manufacturing Organizations (CDMOs), indicating strong market positioning and potential for expansion [35][36] - The company is optimistic about growth opportunities in China, despite current headwinds, and has strengthened its leadership in the region [45][47] Manufacturing and Capital Deployment - The company is considering expanding U.S. manufacturing capabilities in response to industry trends towards onshoring [48][49] - Repligen has a consistent M&A strategy focused on acquiring differentiated products that can enhance their portfolio, particularly in bioprocessing workflows [56][57] - The company aims for a balance between revenue growth and margin improvement in its acquisition strategy [58][59] Conclusion - Repligen is navigating a complex landscape of tariffs, FX fluctuations, and market dynamics while maintaining a strong growth trajectory. The company is well-positioned to capitalize on opportunities in both domestic and international markets, particularly through strategic acquisitions and enhanced manufacturing capabilities.

Company Overview - Repligen Corporation is a global life sciences company focused on developing and commercializing innovative bioprocessing technologies and systems for manufacturing biological drugs [3] - The company operates primarily in areas such as Filtration and Fluid Management, Chromatography, Process Analytics, and Proteins [3] - Repligen's headquarters is located in Waltham, Massachusetts, with manufacturing sites in the U.S. and additional locations in Estonia, France, Germany, Ireland, the Netherlands, and Sweden [3] Upcoming Events - Repligen will participate in the RBC Capital Markets' 2025 Global Healthcare Conference in New York on May 20-21, where CFO Jason K. Garland will engage in an analyst-led discussion and one-on-one meetings with investors [4] - The company will also attend Craig-Hallum's 22nd Annual Institutional Investor Conference in Minneapolis on May 28, with CFO Jason K. Garland participating in one-on-one meetings [4] Investor Relations - A live webcast of the RBC conference presentation will be available on Repligen's Investor Relations website, with a replay accessible for a limited time after the event [2]

Core Insights - The article compares two stocks in the Medical - Biomedical and Genetics sector: Qiagen (QGEN) and Repligen (RGEN), focusing on their attractiveness to value investors [1] Valuation Metrics - Qiagen has a Zacks Rank of 2 (Buy), indicating a stronger earnings outlook compared to Repligen, which has a Zacks Rank of 4 (Sell) [3] - Qiagen's forward P/E ratio is 18.61, significantly lower than Repligen's forward P/E of 81.50 [5] - Qiagen's PEG ratio is 2.40, while Repligen's PEG ratio is 3.91, suggesting that Qiagen may be undervalued relative to its expected earnings growth [5] - Qiagen has a P/B ratio of 2.63, compared to Repligen's P/B of 3.88, further indicating Qiagen's relative value [6] - Based on these metrics, Qiagen holds a Value grade of B, while Repligen has a Value grade of D [6] Earnings Outlook - Qiagen is noted for its improving earnings outlook, which enhances its position in the Zacks Rank model, making it a more attractive option for value investors [7]

Core Insights - Repligen Corporation reported first-quarter 2025 adjusted earnings per share of 39 cents, exceeding the Zacks Consensus Estimate of 35 cents and up from 30 cents in the same quarter last year [1][5] - Total revenues reached $169 million, reflecting a 10% year-over-year increase, and an 11% organic growth when excluding acquisition and currency impacts, surpassing the Zacks Consensus Estimate of $164 million [2][6] - The company anticipates total revenues for 2025 to be between $695 million and $720 million, slightly higher than previous guidance, while adjusted EPS is expected to be between $1.63 and $1.72, down from earlier estimates [10][11] Financial Performance - Product revenues were $169.1 million, marking a 10.5% increase from the previous year, while royalty and other revenues decreased by 2.7% to $0.04 million [5][6] - Adjusted gross margin improved to 53.7% from 49.2% year-over-year, with adjusted operating income rising to $23.4 million compared to $13.6 million in the prior year [8][9] - Total orders grew nearly 20%, with all four business franchises experiencing double-digit growth [6] Business Segments - Revenues from biopharma and consumables increased by over 20% year-over-year, driven by strong orders, although CDMO sales saw a slight decline [7] - The company reported 14% organic non-COVID revenue growth for the first quarter, indicating robust performance in its core business segments [6] Guidance and Outlook - Repligen expects adjusted gross margin for 2025 to be between 52% and 53%, reflecting a 100 basis point increase from previous expectations [11] - The updated guidance incorporates the impact of the acquisition of 908 Devices' bioprocessing analytics business, which aims to enhance Repligen's process analytical technology portfolio [11] - The company reiterated its organic revenue growth guidance for 2025 in the range of 9.5% to 13.5% [11]

[PART I - FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents Repligen Corporation's unaudited condensed consolidated financial statements for Q1 2025 and 2024, along with detailed notes on significant financial activities [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased slightly to **$2.85 billion** as of March 31, 2025, driven by goodwill and intangible assets from acquisitions, while total liabilities rose to **$866.7 million** Condensed Consolidated Balance Sheets (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $697,229 | $757,355 | | Total current assets | $1,032,465 | $1,066,041 | | Goodwill | $1,082,413 | $1,030,995 | | Intangible assets, net | $409,225 | $397,897 | | **Total assets** | **$2,852,143** | **$2,829,666** | | **Liabilities & Equity** | | | | Total current liabilities | $151,996 | $126,787 | | Convertible Senior Notes due 2028, net | $529,605 | $525,567 | | **Total liabilities** | **$866,660** | **$856,948** | | **Total stockholders' equity** | **$1,985,483** | **$1,972,718** | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Q1 2025 total revenue increased **10.4%** to **$169.2 million**, with net income rising to **$5.8 million** and diluted EPS reaching **$0.10** Q1 2025 vs Q1 2024 Performance (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenue | $169,172 | $153,182 | | Income from Operations | $6,578 | $3,750 | | Net Income | $5,830 | $3,296 | | Diluted EPS | $0.10 | $0.06 | [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Total stockholders' equity increased to **$1.985 billion** by March 31, 2025, primarily due to **$5.8 million** in net income and **$7.3 million** in stock-based compensation - Key changes in stockholders' equity for Q1 2025 include a **$5.8 million** increase from net income and a **$7.3 million** increase from stock-based compensation expense[12](index=12&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating cash flow significantly decreased to **$15.0 million**, with investing activities using **$74.1 million** primarily for an acquisition, leading to a **$60.1 million** overall cash decrease Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $15,005 | $44,708 | | Net cash used in investing activities | ($74,108) | ($8,362) | | Net cash used in financing activities | ($5,030) | ($8,974) | | **Net (decrease) increase in cash** | **($60,126)** | **$29,294** | - The primary use of cash in investing activities was **$69.7 million** for an acquisition, net of cash acquired[15](index=15&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes detail significant accounting policies, fair value measurements, recent acquisitions, restructuring, revenue recognition, goodwill, debt, equity, income taxes, and segment reporting - On March 4, 2025, the Company acquired 908 Devices Inc.'s PAT Portfolio for cash consideration of **$69.9 million**, resulting in **$50.1 million** of goodwill[39](index=39&type=chunk)[41](index=41&type=chunk)[43](index=43&type=chunk) - The company recorded pre-tax restructuring charges of **$2.0 million** in Q1 2025 as part of its ongoing Restructuring Plan initiated in July 2023[52](index=52&type=chunk)[53](index=53&type=chunk) - The effective tax rate for Q1 2025 was **26.6%**, compared to **10.8%** for Q1 2024, primarily due to higher pre-tax income and lower stock windfall tax benefits[92](index=92&type=chunk) - The company operates as a single reportable segment, with Q1 2025 revenue geographically distributed as **50% North America**, **35% Europe**, and **15% APAC/Other**[100](index=100&type=chunk)[102](index=102&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 financial results, highlighting a **10.4%** revenue increase driven by product performance, the impact of acquisitions, and the company's liquidity position [Results of Operations](index=26&type=section&id=Results%20of%20Operations) Q1 2025 total revenue increased **10.4%** to **$169.2 million**, with gross margin improving to **53.6%**, while operating expenses, particularly SG&A, also rose Revenue and Gross Margin Comparison | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $169.2M | $153.2M | +10.4% | | Gross Margin | 53.6% | 50.1% | +3.5 p.p. | - The increase in product revenue was mainly due to timing of sales for Proteins and strong performance in the Chromatography and Analytics franchises, with newly acquired 908 Devices products contributing **$1.0 million**[119](index=119&type=chunk) - SG&A costs increased by **$9.5 million** (**15.3%**), primarily driven by a **$6.3 million** increase in professional services related to acquisition and integration activities[128](index=128&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and cash equivalents decreased to **$697.2 million** by March 31, 2025, primarily due to the **$69.7 million** acquisition, with operating cash flow also declining due to working capital changes - Cash and cash equivalents stood at **$697.2 million** at the end of Q1 2025[135](index=135&type=chunk) - Working capital decreased by **$58.8 million** to **$880.5 million**, primarily due to the 908 Devices PAT Portfolio acquisition in March 2025[136](index=136&type=chunk) - Cash from operating activities decreased by **$29.7 million** YoY, driven by an increase in accounts receivable and a decrease in accounts payable and accrued expenses[139](index=139&type=chunk)[140](index=140&type=chunk) - The company believes current cash balances are adequate to meet cash needs for at least the next 24 months, absent major acquisitions or debt conversions[148](index=148&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes to the company's market risk exposure were reported during Q1 2025 compared to the prior annual report - There were no material changes to the company's market risk exposure during Q1 2025[155](index=155&type=chunk) [Item 4. Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were ineffective as of March 31, 2025, due to previously identified material weaknesses in internal control over financial reporting - Management concluded that the company's disclosure controls and procedures were not effective as of March 31, 2025[157](index=157&type=chunk) - The ineffectiveness is due to three previously reported material weaknesses concerning: 1) revenue recognition controls, 2) IT general controls (access and change management), and 3) business process controls for inventory valuation and financial close[158](index=158&type=chunk)[162](index=162&type=chunk) - A remediation plan is being implemented to address the deficiencies, but the material weaknesses have not yet been remediated[159](index=159&type=chunk)[160](index=160&type=chunk)[163](index=163&type=chunk) [PART II - OTHER INFORMATION](index=34&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company is not aware of any material legal proceedings or claims that would adversely affect its business or financial condition - The company is not aware of any material legal proceedings or claims against it[166](index=166&type=chunk) [Item 1A. Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors from the most recent Form 10-K have been reported - No material changes to risk factors from the most recent Form 10-K have been reported[167](index=167&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - None[168](index=168&type=chunk) [Item 5. Other Information](index=34&type=section&id=Item%205.%20Other%20Information) No Rule 10b5-1 trading plan activities by directors or officers were reported for the fiscal quarter ended March 31, 2025 - No Rule 10b5-1 trading plan activities by directors or officers were reported for the quarter[171](index=171&type=chunk) [Item 6. Exhibits](index=35&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents

Financial Data and Key Metrics Changes - The company reported first quarter revenue of $169 million, exceeding expectations despite a $2 million foreign exchange headwind, representing a 10% increase year-on-year [26][27] - Organic revenue growth was 11%, and organic non-COVID revenue growth was 14%, with acquisitions contributing approximately 1% to reported growth [28][34] - Adjusted net income was $22 million, up 29% from the previous year, with adjusted fully diluted earnings per share increasing to $0.39 from $0.30 [31][32] Business Line Data and Key Metrics Changes - Organic revenue growth in Q1 was driven by proteins, chromatography, and analytics, with proteins showing the highest growth [11][22] - Consumables revenue grew over 20% year-on-year, while capital equipment revenues declined as expected [15][20] - Chromatography orders increased by over 50%, marking the highest quarterly order intake in three years [22] Market Data and Key Metrics Changes - North America represented 50% of total revenue, Europe 35%, and Asia Pacific 15%, with North America and Europe both up 13% [28] - China accounted for only 2% of total revenue, continuing to decline, while other regions showed strong growth [17][29] Company Strategy and Development Direction - The company is focused on executing its strategic plan for 2025, including the acquisition of the nine zero eight devices bioprocessing portfolio and launching new products [10][18] - The management emphasized the importance of a diversified customer base, with no single customer representing more than 6% of total revenue [12][13] - The company aims to leverage its global manufacturing network to mitigate tariff impacts and maintain growth [9][10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macro uncertainties but expressed confidence in the underlying trends and opportunities within the business [6][10] - The company expects revenue growth to accelerate throughout the year, supported by a strong backlog and order trends [15][24] - Management remains optimistic about the mid to long-term outlook for new modalities, despite short-term challenges [58][59] Other Important Information - The company made investments in finance and quality to enhance visibility and customer experience [19][20] - Adjusted gross profit was $91 million, resulting in a 53.7% adjusted gross margin, up nearly 450 basis points year-on-year [29][30] Q&A Session Summary Question: Impact of tariffs on CDMO order trends - Management noted no acceleration in orders due to tariffs, with strong order intake growth across all customer segments, particularly from CDMOs [46][47] Question: Revenue exposure to tariffs - Management indicated that potential revenue exposure to tariffs is low, with minimal impact on EPS, and emphasized the ability to pass through costs via surcharges [49][50] Question: Outlook for new modalities - Management remains optimistic about new modalities, with sales and orders showing growth, and no significant disruptions reported from customers regarding clinical trials [58][59] Question: Changes in clinical versus commercial mix - The company reported a stable mix of 65% clinical to 35% commercial, with expectations of a gradual shift towards more commercial business in the coming years [64][66] Question: FDA guidance on animal testing - Management has not observed any significant customer concerns regarding FDA guidance on phasing out animal testing, and clinical trial starts have been increasing [96][97] Question: Manufacturing flexibility in response to tariffs - The company has dual manufacturing sites and is exploring further opportunities to shift manufacturing as needed to mitigate tariff impacts [97][98]

Core Viewpoint - Repligen (RGEN) reported quarterly earnings of $0.39 per share, exceeding the Zacks Consensus Estimate of $0.35 per share, and showing an increase from $0.28 per share a year ago, indicating a positive earnings surprise of 11.43% [1][2] Financial Performance - The company achieved revenues of $169.17 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 2.85% and up from $151.35 million year-over-year [2] - Over the last four quarters, Repligen has exceeded consensus EPS estimates three times and topped revenue estimates two times [2] Stock Performance and Outlook - Repligen shares have declined approximately 0.2% since the beginning of the year, contrasting with the S&P 500's decline of 6% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] Earnings Estimates - The current consensus EPS estimate for the upcoming quarter is $0.42 on revenues of $174.55 million, and for the current fiscal year, it is $1.69 on revenues of $701.98 million [7] - The estimate revisions trend for Repligen is currently mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Medical - Biomedical and Genetics industry, to which Repligen belongs, is currently ranked in the top 31% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - The company reported first quarter revenue of $169 million, exceeding expectations despite a $2 million foreign exchange headwind, representing a 10% increase year-on-year [29] - Organic revenue growth was 11%, and organic non-COVID revenue growth was 14%, indicating strong underlying performance [29][30] - Adjusted net income was $22 million, up 29% from the previous year, with adjusted fully diluted earnings per share increasing to $0.39 from $0.30 [33][35] Business Line Data and Key Metrics Changes - Organic revenue growth in the first quarter was driven by proteins, chromatography, and analytics, with proteins showing the highest growth [13] - Filtration revenues were slightly up, while capital equipment saw some softness due to timing, but a backlog supports growth in the latter half of the year [13][17] - Chromatography grew double digits, with orders increasing over 50%, marking the highest quarterly order intake in three years [24] Market Data and Key Metrics Changes - Biopharma revenues grew more than 20% year-on-year, supported by strong execution from strategic accounts [16] - North America represented 50% of total revenue, Europe 35%, and Asia Pacific 15%, with North America and Europe both up 13% [30] - China represented only 2% of total revenue, continuing to decline, but the company believes it can offset this due to strong performance in other regions [30][19] Company Strategy and Development Direction - The company is focused on executing its strategic plan for 2025, including the acquisition of the nine zero eight devices bioprocessing portfolio and launching new products [12][20] - The management emphasized the importance of a diversified customer base, with no single customer representing more than 6% of total revenue [14] - The company aims to leverage its global manufacturing network to mitigate tariff impacts and maintain strong growth [11][10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macro uncertainties but expressed confidence in the underlying trends and opportunities within the business [8][9] - The company expects revenue growth to accelerate throughout the year, with strong order trends indicating momentum [27] - Management remains optimistic about the mid to long-term outlook for new modalities, despite short-term challenges [63] Other Important Information - The company made investments in finance and quality to improve visibility and customer experience [21] - Adjusted gross profit was $91 million, with a gross margin of 53.7%, up nearly 450 basis points year-on-year [31] - The company expects adjusted income from operations to be between $95 million to $102 million for the full year [41] Q&A Session Summary Question: CDMO order trends and tariff impacts - Management noted no acceleration in orders due to tariffs, with strong order intake across all CDMO customers [50][51] Question: Tariff dynamics and revenue exposure - Management indicated minimal revenue exposure to tariffs, estimating less than 1% sales increase from surcharges [54][56] Question: Emerging modalities and FDA changes - Management remains optimistic about new modalities, with no significant disruptions reported from customers regarding FDA changes [64] Question: Small biotech customer trends - Orders from small biotech were flat, with a decline in sales to emerging markets, raising concerns about the health of that segment [80] Question: Impact of FDA's guidance on animal testing - Management has not heard any tangible impacts from FDA guidance on animal testing, with no significant changes reported by customers [99]

Financial Data and Key Metrics Changes - The company reported first quarter revenue of $169 million, exceeding expectations despite a $2 million foreign exchange headwind, representing a 10% increase year-on-year [29] - Organic revenue growth was 11%, and organic non-COVID revenue growth was 14%, indicating strong underlying performance [29][30] - Adjusted net income was $22 million, up 29% from the previous year, with adjusted fully diluted earnings per share increasing to $0.39 from $0.30 [33][35] Business Line Data and Key Metrics Changes - Organic revenue growth in the first quarter was driven by proteins, chromatography, and analytics, with proteins showing the highest growth [13][24] - Consumables revenue grew over 20% year-on-year, while capital equipment revenues declined as expected [17][22] - Chromatography orders increased by over 50%, marking the highest quarterly order intake in three years [24] Market Data and Key Metrics Changes - Biopharma revenues grew more than 20% year-on-year, supported by strong execution from strategic accounts [16] - North America represented 50% of total revenue, with both North America and Europe up 13%, while Asia excluding China grew by 12% [30] - China represented only 2% of total revenue, continuing to decline [19][30] Company Strategy and Development Direction - The company is focused on executing its strategic plan for 2025, including the acquisition of the nine zero eight devices bioprocessing portfolio [12][20] - The management emphasized the importance of diversifying the customer base, with the largest customer representing only 6% of revenue [14] - Continued investment in R&D and product development is a priority, with new product launches expected to drive future growth [21][45] Management Comments on Operating Environment and Future Outlook - Management acknowledged macro uncertainties but expressed confidence in the underlying trends and opportunities within the business [8][9] - The company expects revenue growth to accelerate throughout the year, with a strong backlog supporting growth in capital equipment [17][27] - Management remains optimistic about the mid to long-term outlook for new modalities, despite short-term challenges [63] Other Important Information - The company is navigating tariff impacts with minimal expected effects on earnings per share, as most manufacturing is based in the U.S. [10][12] - Adjusted gross profit was $91 million, with a gross margin of 53.7%, reflecting strong volume leverage and favorable product mix [31][32] - The company plans to maintain a strong balance sheet while being prudent in spending and preparing for potential acquisitions [45] Q&A Session Summary Question: CDMO order trends and tariff impact - Management noted no acceleration in orders due to tariffs, with strong order intake across all customer sizes and product lines [50][51] Question: Tariff dynamics and pricing pass-through - Management indicated a potential less than 1% sales increase from tariffs, primarily through surcharges, with minimal impact on gross margins [54][56] Question: Emerging modalities and FDA changes - Management remains optimistic about new modalities, with no significant disruptions reported from customers regarding clinical trials [62][64] Question: Small biotech customer trends - Orders from small biotech customers were flat, with a decline in sales to emerging markets, raising concerns about the health of that segment [78][80] Question: Impact of FDA guidance on animal testing - Management has not heard of any tangible impacts from FDA guidance on animal testing, with no significant changes reported by customers [98][99] Question: Manufacturing flexibility in response to tariffs - The company has multiple manufacturing sites and is exploring dual manufacturing options to mitigate potential tariff impacts [100][101] Question: Clarification on revenue guidance - Management confirmed an increase in organic non-COVID revenue growth guidance, indicating positive demand fundamentals [106]