OraSure Technologies(OSUR) - 2025 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue in Q2 was $31.2 million, with core revenue at $30.8 million, which was above the midpoint of guidance [21] - Core revenue growth would have been positive year over year if excluding the decline from a large consumer genetics customer [21] - GAAP gross margin was 42.1%, and non-GAAP gross margin was 43.2%, better than expectations [22] - GAAP operating loss in Q2 was $18 million, while non-GAAP operating loss was $13.2 million [23] - Operating cash flow in Q2 was negative $10 million, consistent with expectations due to investments in innovation [23] Business Line Data and Key Metrics Changes - Diagnostics revenue was $19.2 million in Q2, growing 3% year over year [21] - Sample Management Solutions revenue was $9.9 million, with growth from other customers excluding the large consumer genetics customer [21] - COVID-19 and risk assessment testing products contributed $474,000 in revenue, consistent with guidance [22] Market Data and Key Metrics Changes - International diagnostics business showed year-over-year revenue growth despite disruptions from USAID funding freezes [8] - US diagnostics revenue declined 1% year over year, with public health customers facing budget cuts and staffing reductions [11] - The "Together Take Me Home" program may continue beyond September 30, with expected revenue of approximately $500,000 in Q3 compared to $2 million in Q2 [12] Company Strategy and Development Direction - The company is focused on three strategic pillars: strengthening the foundation, elevating core growth, and accelerating profitable growth [5] - New product launches, such as HemoCollect protein, aim to meet evolving needs in proteomic research [6][15] - The transition to in-house manufacturing for Sample Management Solutions is expected to improve operational efficiencies starting in 2025 [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to growth in 2026 as customers adapt to the new environment [27] - The company is closely monitoring funding uncertainties in public health programs and research [8][11] - Management highlighted the importance of maintaining strong customer relationships while cultivating new ones [13] Other Important Information - Ann Metzing joined as Chief Commercial Officer to drive sales, marketing, and product management [7] - The company is evaluating inorganic growth opportunities to expand its product portfolio [24] Q&A Session Summary Question: Can you provide specifics on the Q3 guidance regarding HIV and HCV platforms? - Management indicated that Q3 revenue guidance is influenced by the "Together Take Me Home" program and expected slower orders for HIV tests due to inventory management in international markets [33][35] Question: What initial traction has been seen with the HemoCollect protein product? - Management reported enthusiastic customer engagement and highlighted the product's potential in various clinical applications, including oncology and neurology [39][40]