Ginkgo Bioworks (US:DNA)2025-11-06 21:17Revenue Generation - Ginkgo's revenue is generated primarily through cell engineering services, with a focus on license and collaboration agreements for engineered organisms [170]. - Ginkgo's cell engineering revenue includes transactions with Platform Ventures and Legacy Structured Partnerships, involving upfront non-cash consideration and R&D services [174]. - Total revenue for the nine months ended September 30, 2025, was $136.8 million, compared to $183.2 million for the same period in 2024, reflecting a decrease of $46.4 million [196]. - Cell Engineering revenue for Q3 2025 was $29.4 million, down from $75.1 million in Q3 2024, a decrease of $45.7 million, largely due to the recognition of $45.4 million in non-cash revenue from a terminated contract in Q3 2024 [197]. - Biosecurity revenue for Q3 2025 was $9.5 million, down from $14.0 million in Q3 2024, a decrease of $4.5 million, primarily due to lower revenue from U.S. government programs [201]. Expenses and Cost Management - R&D expenses decreased in the first half of 2025 compared to the first half of 2024, attributed to a restructuring plan initiated in Q2 2024 [181]. - The company expects R&D expenses to stabilize or decline in 2025, depending on technology advances and market penetration [181]. - General and Administrative (G&A) expenses were lower in the first half of 2025 compared to the first half of 2024, primarily due to a restructuring plan initiated in Q2 2024, with expectations for G&A expenses to remain consistent or decline in 2025 [183]. - Research and development expenses decreased to $69.4 million for the three months ended September 30, 2025, down from $77.0 million in 2024, a reduction of 10.0% [209]. - General and administrative expenses were $45.0 million for the three months ended September 30, 2025, down from $52.3 million in 2024, a decrease of 13.9% [211]. - The company recorded restructuring charges of $10.7 million for the nine months ended September 30, 2025, down from $20.0 million in 2024, a decrease of 46.5% [214]. Financial Performance - The net loss for Q3 2025 was $80.8 million, compared to a net loss of $56.4 million in Q3 2024, an increase in loss of $24.4 million [196]. - The company reported a net loss of $232.0 million for the nine months ended September 30, 2025, with non-cash charges of $129.1 million [233]. - Interest income, net for Q3 2025 was $5.7 million, down from $9.3 million in Q3 2024, a decrease of $3.5 million [196]. - Interest income, net for the nine months ended September 30, 2025, was $17.9 million, compared to $31.3 million in 2024, a decrease of 42.5% [217]. - Gain on investments was $3.7 million for the three months ended September 30, 2025, compared to a loss of $6.9 million in 2024 [218]. Cash Flow and Liquidity - As of September 30, 2025, the company had cash and cash equivalents and marketable securities totaling $461.9 million, expected to fund operations for at least the next 12 months [230]. - For the nine months ended September 30, 2025, net cash used in operating activities was $123.4 million, compared to $277.2 million for the same period in 2024 [232]. - Cash used in investing activities for the nine months ended September 30, 2025, was $335.4 million, primarily due to purchases of marketable debt securities totaling $401.8 million [237]. - Net cash provided by financing activities for the nine months ended September 30, 2025, was $9.6 million, mainly from an ATM offering [239]. - As of September 30, 2025, the company had cash equivalents and marketable debt securities totaling $419.6 million [242]. Strategic Initiatives - In Q3 2024, Ginkgo launched new cell engineering tools, including Datapoints and lab automation solutions, aimed at providing large biological datasets for AI model training [173]. - The Foundry and Codebase are key components of Ginkgo's platform, enhancing laboratory automation and data generation capabilities [155]. - Ginkgo's automation solutions, including Reconfigurable Automation Cart systems, enable high throughput experimentation and are expected to resolve 80-90% of system errors remotely [161]. - The company aims to build a robust early warning system for biological threats as part of its biosecurity mission [162]. - The company plans to continue R&D activities and potentially acquire companies or assets to advance its objectives [234]. Market Conditions - Inflation has not had a material effect on the company's financial condition or results of operations during the reported periods [244]. - The company anticipates expenditures will exceed revenue for at least the next 12 months [232].