Champions Oncology(CSBR) - 2025 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue for Q2 was $13.5 million, representing a 17$700,000, compared to a loss of $1.9 million in the prior year [12] - Adjusted EBITDA for Q2 was$1.1 million, compared to an adjusted loss of $1.4 million in the year-ago period [12] - Gross margin improved to 45$27.6 million, an increase of 14% compared to 24 million in the first half of 2024 [16] Business Line Data and Key Metrics Changes - The core services business experienced sustained growth driven by the PDX bank and multi-omic data [5] - R&D expenses decreased to approximately 1.7 million from $2.5 million year-over-year, a decline of$800,000 [14] - Sales and marketing expenses remained mostly unchanged at $1.7 million compared to$1.8 million last year [15] - G&A expenses decreased to $1.6 million from$2.1 million, primarily due to reduced compensation and recruitment expenses [15] Market Data and Key Metrics Changes - The funding environment is showing signs of improvement, particularly from big pharma and the biotech sector, although it has not fully returned to previous levels [23][24] - There is increased investment in the biotech sector, indicating a cautiously optimistic outlook for funding [23] Company Strategy and Development Direction - The company is focusing on monetizing its unique data assets and plans to introduce a new revenue stream through data licensing [7] - The strategy includes enhancing the characterization of tumor models to provide valuable insights for drug development [6] - The company aims to transform its data strategy into a data business that will significantly impact revenue and enterprise value [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to a path of strong financial results and anticipates revenue growth of 10% to 15% for fiscal 2025 [19][20] - The company expects a slight decline in research service revenues next quarter, with a reacceleration anticipated in the fourth quarter [19] Other Important Information - The company ended the quarter with $2.8 million in cash and no debt, indicating a solid cash position [18] - Cash used in operating activities was$300,000, primarily due to an increase in accounts receivable [18] Q&A Session Summary Question: What are the market dynamics regarding funding? - Management noted that while the funding environment is not back to previous levels, it has improved over the last year, with cautious optimism for future funding from big pharma and biotech [23][24] Question: Are there any new tests or services being rolled out? - Management highlighted the focus on the unique biological data created over the years, emphasizing the potential for growth in this area, particularly with the advent of AI [27][28]