Dyadic(DYAI) - 2025 Q2 - Quarterly Results

Executive Summary Q2 2025 Highlights and Strategic Shift Dyadic's Q2 2025 results mark a pivotal shift to a market-facing, revenue-focused biotech, rebranding with $5.3 million equity - Q2 2025 marked a pivotal turning point, advancing Dyadic's transformation from a technology development organization to a market-facing, revenue-focused biotechnology company[3] - The company rebranded as Dyadic Applied BioSolutions to reflect new operational priorities and commitment to commercial execution[3][5] - Anticipated upcoming launches include DNase I and recombinant human albumin through a partnership with Proliant Health and Biologics, expected to be product-driven revenue catalysts[3] Recent Company Developments and Updates Strategic and Operational Transformation Dyadic completed a strategic shift from R&D to commercial operations, rebranding and securing $5.3 million in equity funding - Completed Strategic Leadership and Operational Transformation from R&D to Commercial Operations[5] - Rebranded as Dyadic Applied BioSolutions to Reflect New Operational Priorities[5] - Completed $5.3 million Equity Offering to Strengthen Liquidity and Help Fund Pipeline and Commercial Growth[5] Life Sciences Pipeline Dyadic advanced its life sciences pipeline, focusing on non-animal cell culture media, with key proteins nearing commercialization Non-Animal Cell Culture Media The company is advancing recombinant serum albumin towards a commercial launch in 2025, with milestone payments received and expected - Recombinant Serum Albumin: Advancing toward an expected commercial launch in 2025, with $1.0 million in milestone payments received to date and an additional $500,000 anticipated in Q3 2025[6] - Recombinant Transferrin: Demonstrated equivalent performance to leading recombinant reference standards in cell proliferation testing, with sampling and validation actively underway in Q3 2025[6] - Recombinant Fibroblast Growth Factor (FGF): Demonstrated comparable performance to reference standards in supporting animal muscle cell growth, with sampling to cell culture, diagnostic, and research markets underway[7] Food and Nutrition Pipeline Dyadic's food and nutrition pipeline shows progress in DNase-1, expanded nucleic acid enzymes, and non-animal dairy applications DNase-1 and Nucleic Acid Enzymes RNase-free DNase-1 is advancing toward commercial availability, and prototypes for four additional nucleic acid enzymes are under development - DNase-1 (RNase-free): Advancing toward commercial availability for molecular diagnostics and biopharma, with successful initial scale-up and active sampling[10] - Expanded Nucleic Acid Enzymes Portfolio: Developing and validating prototypes for four additional enzymes, including RNase Inhibitors and T7 RNA Polymerase, with results expected by late 2025 and into 2026[10] Non-Animal Dairy Applications Dyadic is negotiating licensing for recombinant alpha-lactalbumin, developed a stable cell line for human lactoferrin, and expects a $250,000 milestone payment from Inzymes - Alpha-Lactalbumin: Actively negotiating licensing and supply agreements, with sampling for the cell culture research market expected in Q4 2025[10] - Human Lactoferrin: A stable cell line has been developed, with sampling for research use expected to begin in the second half of 2025[10] - Non-Animal Dairy Enzymes: Dyadic expects to receive a $250,000 milestone payment from Inzymes for productivity achievements, with the first enzyme progressing toward a late 2025 launch[10] Strategic Partnerships and Grants Dyadic is engaged in strategic partnerships and grants, including projects with the Gates Foundation and CEPI, expanding its platform applications - Gates Foundation Monoclonal Antibody Project: Achieved milestones, resulting in a second installment of $1.5 million in non-dilutive funding from a $3.0 million grant for low-cost monoclonal antibodies[21] - CEPI-FBS Grant: Dyadic's C1 platform is being advanced under a $4.5M CEPI grant, with Dyadic eligible to receive up to $2.4M as a subcontractor for recombinant protein vaccines[21] - Fermbox Bio Partnership: Launched EN3ZYME™—a Dyadic-produced enzyme cocktail for converting agri-residue into fermentable cellulosic sugars—with Dyadic expecting a 50/50 revenue profit share from commercial sales[21] Financial Highlights Cash Position and Equity Offering Dyadic's cash position decreased to $7.3 million by June 30, 2025, but was bolstered by a subsequent $5.3 million equity offering - Cash, cash equivalents, restricted cash, and investment-grade securities were approximately $7.3 million as of June 30, 2025, compared to $9.3 million as of December 31, 2024[13] - On August 1, 2025, the Company closed a public offering, generating approximately $5.3 million in net proceeds, intended for working capital and general corporate purposes[14] Revenue Analysis Total revenue for Q2 2025 significantly increased to $967,000, driven by a $250,000 milestone payment and new grant revenue - Total revenue for Q2 2025 increased to $967,000, up from $386,000 for the same period a year ago, representing a 150.5% increase[15] - The increase was driven by $250,000 milestone revenue from the Inzymes Agreement and grant revenue from the Gates Foundation and CEPI[15] | Revenue Type | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Research and development revenue | $213,449 | $385,896 | -44.7% | | Grant revenue | $503,181 | — | N/A | | License and milestone revenue | $250,000 | — | N/A | | Total revenue | $966,630 | $385,896 | +150.5% | Cost of Revenue Cost of research and development and grant revenue for Q2 2025 increased to approximately $614,000, primarily due to new grant-related costs - Cost of research and development revenue and cost of grant revenue for Q2 2025 increased to approximately $614,000 compared to $302,000 for the same period a year ago[16] - The increase was related to the cost of grant revenue from the Gates Foundation and CEPI[16] | Cost Type | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Costs of research and development revenue | $148,457 | $301,956 | -50.8% | | Costs of grant revenue | $465,134 | — | N/A | | Total Cost of Revenue | $613,591 | $301,956 | +103.2% | Operating Expenses (R&D, G&A) Research and development expenses increased by 22% to $629,000, while general and administrative expenses decreased by 10.6% to $1,437,000 - Research and development expenses for Q2 2025 increased to $629,000 compared to $516,000 a year ago, driven by a rise in active internal research initiatives[17] - General and administrative expenses for Q2 2025 decreased by 10.6% to $1,437,000 compared to $1,608,000 a year ago, reflecting reductions in various operational costs[18] | Expense Type | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Research and development | $629,379